Netflix CEO Reed Hastings says he doesn’t have a problem with T-Mobile’s controversial Binge On service — in fact, Netflix is actually a fan of it. Binge On lets T-Mobile customers stream video from services like Netflix and HBO without it counting toward their monthly data caps. It’s drawing net neutrality activists' ire, however, because it gives an advantage to the companies included in Binge On, like Netflix, over companies that aren’t, like YouTube. Hastings doesn't see it that way, choosing instead to use the arguments of T-Mobile CEO John Legere, despite Netflix once asserting the very same practice "distorted consumer choice."
"It’s voluntary to the customer. Every customer of T-Mobile can decide to turn it on or turn it off," Hastings explained on an earnings call today. "They’re not charging any of the providers. It’s an open program. Many of our competitors such as Hulu and HBO are in the program also." Netflix may be more inclined to defend this program because the company benefits from it: Hastings says that Netflix is seeing more viewership from T-Mobile customers — no surprise since it makes "unlimited video consumption possible." Hastings added that he hopes these kinds of programs expand further.
Netflix is siding with T-Mobile on exempting certain mobile traffic from data plans
T-Mobile, which launched Binge On in November, automatically turned the service on for every one of its customers, letting them enjoy streaming video from Netflix and others without it counting against their monthly cap. The downside is that T-Mobile decided to limit all video on its network to 480p, even if it's video that still counts toward the cap. Customers are able to opt-out, but only by doing so on T-Mobile's website.
In other words, no one actively chose to be part of Binge On at launch, but every customer still has to go out of their way to restore high-quality video (including people on smaller data plans that aren’t eligible for the unlimited streaming perk). YouTube took issue with the practice back in December, and the EFF called for the FCC to investigate T-Mobile's behavior after determining the company was using misleading language by calling its video capping "optimized" instead of "throttled." It appears the FCC is now starting to look into zero-rating programs like Binge On and Verizon's new FreeBee initiative that exempt distinct types of data from counting toward a smartphone user's monthly cap.
"Zero rating isn't great for consumers."
More than anything, however, Hastings' comments today stand in stark contrast to his company's position on net neutrality back in 2014. Netflix was a vocal supporter of enacting new net neutrality rules to protect consumers from internet service providers. One of Netflix's main gripes, in fact, was with zero-rating services that treated some internet traffic differently than other traffic, which sounds an awful lot like Binge On. The company even participated in a zero-rating scheme with Australian internet providers only to say later on that it "should have avoided that and will avoid it going forward." Netflix went so far as to say, "Zero rating isn't great for consumers as it has the potential to distort consumer choice in favor of choices selected by an ISP."
Of course, this wouldn't be the first time Netflix’s opinion on net neutrality coincided with what’s best for its business. The company publicly battled companies like Comcast for months in 2014 over an arcane technical agreement about who was responsible for covering the infrastructure cost of streaming video. Netflix ultimately paid fees to Comcast and Verizon. However, Hastings used the arrangement to spin an impassioned net neutrality defense, writing in March of that year, "The essence of net neutrality is that ISPs such as AT&T and Comcast don't restrict, influence, or otherwise meddle with the choices consumers make."
Now that protections are in place thanks to FCC regulation, Netflix looks as if it's picking and choosing again which potential violations of net neutrality the company would like to give a free pass.