If Comcast CEO Brian Roberts Really Believes Netflix Gets Bandwidth For Free, Will He Pay Netflix's Bandwidth Bill?
from the just-saying... dept
So there was some buzz earlier this week when Comcast CEO Brian Roberts, speaking at the Code Conference, more or less admitted that he was seeking to shake down the entire internet:In a series of analogies, Roberts likened his company’s role to that of a postmaster, pointing out that Netflix pays hundreds of millions of dollars to mail DVDs to its customers but now expects to be able to deliver the same content over the internet for free.Except, of course, Netflix already pays for its bandwidth. And Comcast's customers already pay for their bandwidth. What Roberts really wants to do is to get Netflix to pay a second time for Comcast's customers' bandwidth, even though they're already paying for it.
“They would like it all to be free. I would like to not have to pay for cable boxes,” he said.
As for this argument that Netflix is trying to get anything "for free," we went through this ridiculous argument nearly a decade ago, when the lobbyists for the telcos made the same claim (though, at that time it was about Google instead of Netflix). Mike McCurry, working as an AT&T lobbyist at the time, argued that Google "will never have to pay a dime no matter how much bandwidth they use." Basically the same argument that Roberts is making about Netflix wanting "it all to be free."
So as we did with McCurry, we'd like to make a small request of Roberts: if he's so sure that Netflix pays nothing for these things, why not agree to pay Netflix's bandwidth bill? After all, he's arguing that it's free, so he shouldn't have to pay anything. Of course he knows that Netflix pays a ton for bandwidth. And he knows that his customers pay a ton for bandwidth. He's just hoping to get them both to pay more.
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Filed Under: brian roberts, double paying, fud, mike mccurry, net neutrality, open internet
Companies: comcast, netflix
Reader Comments
The First Word
“Paying for mail
I don't actually pay anything to receive mail in my mailbox, and I don't know anyone who has been told that they receive too much mail and they're being cut off or charged extra.Subscribe: RSS
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What is it you think they're guilty of?
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Neither they are guilty of anything, nor they are that innocent just to serve Comcast customers. It is a matter of two giant business tycoons doing business together, and some innocent intellectuals passing judgements.
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It's "just business" in a way that's similar to how dumping toxic waste in a landfilll is "just business".
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Mr. nasch, what is it you are not understanding? I said Netflix is not "that" innocent as projected by Mr. Chris Brand where one would get a feeling that Netflix is just responding to Comcast customers as a voluntary service. I said Netflix is not "that" innocent, as they are Netflix customers also. You went into court's legal language of 'guilty' and 'innocence'.
Even now if you don't understand, then there is no point in discussing it further.
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That's not legal language, it's English. "Guilty" is the opposite of "innocent". "Not that innocent" implies "somewhat guilty", but you then said they're not guilty of anything. So if they're "not guilty at all" how can they be, at the same time, "not that innocent"? But if you don't feel like responding that's fine, I don't really care.
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Because Comcast extorted them into it. They deliberately allowed service to Netflix to degrade and would only fix it if Netflix paid up.
"That's a nice business you have there, Netflix, it'd be a shame if something happened to it."
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Response to: kenichi tanaka on May 30th, 2014 @ 10:03am
Why the fuck should isps get to double and even triple dip?
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Re: Response to: kenichi tanaka on May 30th, 2014 @ 10:03am
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Re: Response to: kenichi tanaka on May 30th, 2014 @ 10:03am
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Netflix pays their ISP.
Customer of Netflix pays Netflix and their ISP.
Who's not getting paid?!
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Nobody's saying otherwise. What people are (correctly) saying is that Netflix and the viewers already pay for that bandwidth.
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Last I recall, *I* pay my ISP every month to deliver..
If my ISP has a beef with how much I am pulling, they need to take it up with me.
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Reported for sheer STUPIDITY.
The USER ALREADY PAYS THE ISP FOR THE BANDWIDTH. Get this through your thick, entitled skull.
I pay $50 a month for a connection to the internet. I get X-bandwidth for that price. *I* am the one "responsible" for using "all that bandwidth" on my ISP's service. Not netflix. Not google. Not Techdirt. Not anyone. ME. And I ALREADY PAY FOR IT.
Read that paragraph over and over until it sinks into your thick skull.
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If Comcast dislikes how their customers use their bandwidth, maybe they need need to change their pricing accordingly (which they won't, because then nobody would pay for it).
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What Comcast is trying to do is like Fed Ex charging you and Amazon to deliver your purchase. That's double dipping. In the end, the customers end up paying twice.
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Cox Communications, a cable ISP, pays Cogent for transit for things you request from Cox. That's the same kind of double-dipping.
Cogent and Level 3 want to charge smaller networks for transit, but then get annoyed when the bigger networks try to turn it around on them.
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It's pretty common to have payments on both sides in two-sided markets. American Express and other fancy credit cards have annual fees-- but also charge merchants on purchases. Newspapers have subscription fees-- but also charge advertisers. Cable TV has subscription fees-- but also charges advertisers. Sony and Microsoft take cuts from both developers and end users to sell games on their services.
At the same time, considerations can also mean that it makes sense to charge one side zero, or not.
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The Fed Ex analogy applies. Would you want Fed Ex to delay the delivery you paid for because Amazon didn't give them a kickback to not delay it? What if Fed Ex was making it look like the delay was Amazon's fault rather than Fed Ex purposely delaying it?
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First, you don't. Your customers pay for those stupid things.
Second, I'd like to not have to pay for a Roku, or the "smart" part of my smart TV, or a computer. THAT is the equivalent to the cable box - not the internet connection being used.
We need smarter people running these companies...
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What this moronic CEO just asked for was a GOVERNMENT internet equivalent of the USPS so that Netflix will pay for delivery and users only pay for data they send out, not for data they receive.
I'm good with that, though I'm not sure he is...
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NO NO I meant cake! I meant cake.
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Consistent with the cable industry charging...
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Let's use that analogy
And who really pays those hundreds of millions of dollars in postal fees?
Netflix customers. (Surely Roberts isn't dumb enough to think that Netflix, a for-profit corporation, is simply going to absorb those costs.) Netflix customers pay those fees to the postal service, who is of course then responsible for delivering the goods.
Just like Comcast customers pay Comcast (1), who is of course then responsible for delivering the goods.
(1) FAR too much, by the way, given Comcast's insanely high prices, ridiculously low bandwidth, worst-available customer service, surly technicians, lying lobbyists, invasive practices (like forging DNS responses) and incompetent network staff ("we're taking the spam problem seriously" -- Comcast, 2004. Yeah. Right. Sure you are. That's why it's still a problem a decade later).
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Re: Let's use that analogy
Netflix customers pay Netflix, and Netflix pays the USPS to deliver the discs. Receiving mail is (generally) free.
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Re: Re: Let's use that analogy (to: Nasch, #50)
Another level of postal service is that between countries, as organized under the International Postal Union. If you want to mail a letter to someone in England, you buy the appropriate stamp from the United States Post Office, for about three times the cost of domestic mail, and put it on your envelope. The Post Office collects the mail, sorts it out, and hires an airline to carry sacks of mail to Heathrow, outside London, where it hands the sacks over the the Royal Mail, without any money changing hands. If your English correspondent wants to reply, he does the same thing in reverse, and the Royal Mail doesn't pay to have the mail distributed inside the United States. I don't know whether the architects of internet peering consciously copied the postal peering system or not.
If Brian Roberts wants to call himself a postmaster, he should be aware of the case of David L. Carslake, of the Frosty Treats company, back in 2007. Reduced to essentials, the defendant, Carslake, recruited Russian guest-workers on false pretenses, employed them as ice-cream-truck drivers, housing them in apartments controlled by a confederate (six of them in a one-bedroom apartment), and, by fraud and terror, sought to reduce them to a condition of slavery. When the immigrants filed for working papers, in order to find another employer, they were obliged, presumably for want of any alternative address, to use their employer's address. Carslake intercepted mail sent to the immigrants by the United States government, in order to hang onto his labor force. There are serious penalties attached to diverting mail. Carslake thought his Russian guest-workers had no rights he was bound to respect. The FBI had to teach him different. He pled guilty to Obstruction of Mail, presumably in a plea bargain to avoid more serious charges. The prosecutor accepted the plea as the most expedient means to ensure that the Russian guest-workers didn't have to go back to Russia with nothing to show for their summer's work.
http://www.fbi.gov/news/pressrel/press-releases/fbis-top-ten-news-stories-11
http://freshare.net /article/kcs_frosty_treats_to_pay_47555_to_foreign_student_workers_in_obstruction_of/
http://www.law. umich.edu/CLINICAL/HUTRAFFICCASES/Pages/CaseDisp.aspx?caseID=392
http://www.unodc.org/cld//case-law-d oc/traffickingpersonscrimetype/usa/2007/united_states_v._carslake.html?lng=fr
http://www.justice.gov/ usao/mow/news2007/carslake.ple.htm
http://www.pitch.com/FastPitch/archives/2007/09/11/federal-heat-me lts-ice-cream-man
http://www.semissourian.com/story/1434794.html
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See also my comments on this History New Network thread, back in 2011, about a University of Wisconsin professor who was threatened with having his e-mail spied on when he criticized the governor of Wisconsin.
http://hnn.us/blog/137919
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Parenthetically, I see some posts from John Thacker, regurgitating Comcast talking points. I would suggest that he read the prior discussion.
http://www.techdirt.com/articles/20140516/12271727260/comcast-says-its-going-to-slap-all- its-customers-with-data-caps-makes-half-hearted-attempt-to-walk-back-earlier-statements-when.shtml#c 549
http://www.techdirt.com/articles/20140514/06500227230/cable-industrys-own-numbers-show-general-de cline-investment-over-past-seven-years.shtml#c467
http://www.techdirt.com/articles/20140502/070954270 95/interconnection-how-big-broadband-kills-net-neutrality-without-violating-net-neutrality.shtml#c12 9
http://www.techdirt.com/articles/20140502/07095427095/interconnection-how-big-broadband-kills-net-n eutrality-without-violating-net-neutrality.shtml#c160
http://www.techdirt.com/articles/20140502/07095 427095/interconnection-how-big-broadband-kills-net-neutrality-without-violating-net-neutrality.shtml #c244
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So what he is really saying is that Comcast is totally screwing their customers. Netflix sends DVD's in the mail using pre-paid postage and their customers don't pay a dime. When Netflix streams a movie, Netflix pays for the bandwidth to send the movie to the customer and the customer still has to pay for it when they receive it.
Isn't he saying we should all get to stream Netflix without paying for the bandwidth it uses?
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A better analogy...
Note, they aren't HIRING a new mail room guy (adding more bandwidth) to offset their current mail room guy's work, just asking for more money so he can work harder on Netflix's mail instead of everyone else's.
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Comcast CEO Brian Roberts: please keep talking
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Comcast of course greedily refused.
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In their analogy, Comcast isn't the Postmaster. They are more like a owner/organizer of a mailsystem for an apartment complex. Mail comes in and goes out through their office, but they are not at all responsible for making sure the mail from another apartment complex down the street is delivered to the other side of the country.
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Brian - the robber baron - wants Netflix to pay for actual bandwidth used. Most enterprise (Netflix, GM, Walmart, Maryland Department of Transportation, etc.) users pay for access, and bandwidth usage.
Brian - the robber baron - is actually not delivering on promises to the home user. He's stealing from us!
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Theoretically, as you point out, we're paying for access, not guaranteed bandwidth. The only way to pay for actual or guaranteed bandwidth is to be metered, like businesses (and networks paying each other for Internet transit). But no one likes metering (I don't either), so we'll be stuck with paying for access and theoretical maximums we don't get.
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Better idea...
If it's nothing, no one will go for it, if it isn't - he'd better put up or run for the hills.
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Paying for mail
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Re: Paying for mail
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No, all that junk mail does. "The USPS has not directly received taxpayer-dollars since the early 1980s with the minor exception of subsidies for costs associated with the disabled and overseas voters."
http://en.wikipedia.org/wiki/United_States_Postal_Service
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No he doesnt. He is a fuck'n greedy idiot who wants more money and will never bother to understand why he is wrong.
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So...
Regardless, Comcast's phones will be blown up.
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Issue
So the problem of heavy bandwidth use companies like Netflix is that they are also driving ISPs to have to increase the amount of bandwidth they pay for, without actually being able to pass that cost on to the end users. This is where all of your complaining about capping users adds to the squeeze that ISPs feel.
Unless you understand that the internet is both "sender pays" and "receiver pays", then none of this makes sense.
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Re: Issue
Ref: Comcast Launches Commercial CDN Service
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And it's not like the customer's to blame either. The ISP initiated the move from volume based billing to flat rates and apparently they had no problems with the majority of users not using their contracts full capacity.
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Or perhaps you should just come out and admit your bias toward allowing unfettered monopoly.
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con-cast
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Netflix vs. Comcrap
Unfortunately, most of those customers have few (if any) options other than Comcrap for internet access in their area... :-(
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The Last Word
“Re: Issue
That is best answer to all the hand wringing and argument seeking emotional response out of the group users (ISP customers). I would put a link here to a resource but it will fall on minds assured the knowledge, in the form of opinion, is righteous.Ref: Comcast Launches Commercial CDN Service