Netflix refuses to pay extra tax demanded by European internet service providers
english.elpais.com
english.elpais.com
Telcos are lobbying for some of this money to go to them because it's "unfair" that they have to transit so much traffic from big tech companies on behalf of their customers (???): https://www.reuters.com/technology/eu-consult-big-tech-contr...
This always makes me giggle. A company who is already getting paid for transmitting data wants to get paid twice for transmitting some data, essentially charging their customers twice for some of those bits.
Greedy toads.
This demand form telcos is basically a mob shakedown.
"Say Netflix, we heard you're making big money selling your stuff to customers ON OUR TURF. Here's the deal, you give us a cut of your sales, or else, who knows, bad things can happen in this neighborhood, and we can protect you."
> Netflix does not want to pay European internet service providers (ISP) for rising traffic costs due to the popularity of streaming video content.
Edit: Yes, your "somewhat related to" is a pretty reasonable disclaimer. When I'm not trying to read too fast.
I haven't seen an increase in quality /s
Though, I don't blame them for asking. It never hurts. Except perhaps on the PR front when they are turned down. Now they are facing customers that want Netflix and who know that their ISP's desire (or need) for a cut of the action is why they can't get it. Which is a business opportunity for an ISP that can better structure their offerings.
If I drive a rental car to a restaurant, the rental car firm shouldn't demand a cut of my dinner tab, either.
the people who own the infrastructure can ask what ever they want
including to pay to help support the infrastructure your business is using for free
This is more akin to taxing the restaurant. The customer already paid, and the only reason they paid is because they wanted to go to the restaurant. Without the restaurant (or more broadly, places to go), people would have no use for the roads.
netflix delivers data to you
are you saying the delivery man should only buy his car (AWS) and never help maintain the road (infrastructure)?
why should the customer who order food has to pay for the road the delivery person will use? the customer already paid for the service!
why, to you, this analogy only works when it doesn't benefit the customer?
billions $ are circulating in the market, and our core infrastructures always has to suffer
look at what happened in Ohio
oh wait...
we'll keep arguing until Asia gets their interplanetary infrastructure before us
oh wait..
the goal is not to make internet a burden to the people
the goal is to make sure we are moving forward
but this is something obscure to certain people over here, hence our situation
Consider a gravel road that connects your cabin to the main city road. The HOA might charge periodic maintenance fees to keep that road operable, depending on how many miles get driven on it, essentially charging you for usage.
If you then order delivery from a restaurant, then yes, it's very unreasonable for the restaurant to pay for that road's upkeep: they only need to travel that road because you ordered the food.
The restaurant should still pay taxes which go towards maintaining the city roads, but your privately operated HOA doesn't get to toll them to get to your house.
>netflix delivers data to you
You have to stick with one story, you can't change your mind and expect people to not call you out.
>are you saying the delivery man should only buy his car (AWS) and never help maintain the road (infrastructure)?
If netflix runs their own delivery then they already pay for most of the costs including public infrastructure. There is no problem and no reason to pay extra for no additional service being rendered.
>why should the customer who order food has to pay for the road the delivery person will use? the customer already paid for the service!
I don't know in what universe you live but most companies that deliver products charge an extra delivery fee. In the case of the internet, the fee structure is split up so that data centers pay for delivery to a hub node and ISP customers pay for delivery from that hub node to their home. The delivery fee is merely split into two parts, absolutely nothing complicated. The delivery fee of the company is transparently included in their pricing and this means the entire delivery including infrastructure costs is already paid for. Your analogy regarding ISPs being the road makes no sense. ISPs are another delivery company, not a road company as most countries do not legislate that the infrastructure and service have to be separated into multiple companies.
>billions $ are circulating in the market, and our core infrastructures always has to suffer
What does that have to do with anything? High speed internet infrastructure is very cheap, you just need to build it but there is zero incentive to build out infrastructure if you can just charge more money without delivering a faster and higher quality service.
We could have had high speed internet in every country if ISPs weren't incentivized to get subsidies for their copper networks and milk those cash cows dry until they get even more subsidies for the fiber roll out even though they have plenty of money.
But Netflix, like everyone else, already pays for their use of the networks. This looks like double-dipping.
No, it doesn't. You pay your ISP to deliver Netflix data to you.
I am paying my ISP for internet access.
Netflix is paying AWS(?) for internet access.
Why should Netflix have to pay my ISP? I already paid them!
If the ISP's customer has paid for "Down_Mbps/Up_Mbps internet service", then either the ISP needs to deliver the bits, or deliver a refund. If the ISP's management can't figure out how to calculate their costs, and charge enough to turn a profit, then either the shareholders or the government need to replace them with management who can.
And compensation to the current shareholders, for their evidently worthless companies, should be token at most.
It seems sensible to nationalize all critical infrastructure?
This is transparently an effort to keep prices apparently low for the end consumer to make the internet service more attractive to consumers and try to reach into the deep pockets of netflix and other content providers to subsidize that cost. Ultimately that looks to consumers like expensive netflix and cheap ISP, which benefits the ISPs but doesn't really help anyone else.
This seems like extortion more than a tax.
Anyway, in the end, the ISP may just "limit Netflix bandwidth". Then he will lose some customers (changing ISP)... but Netflix will lose some customers too (leaving Netflix because of bad quality compared to another content provider). This would be a lose/lose game
Or both may agree to share a part of the burden of "heavy contents", most for ISP et a bit for Netflix
So they got creative and figured out they can ask for a Netflix tax to make it seems like it's fair compensation for the "huge" bandwidth the service is consuming.
The users are already paying their ISP for the traffic they're generating. Whether they're using it to access Netflix or any other website.
If that is your argument, then the entire subscription contract with the ISP is inherently fraudulent as they are advertising a service that they are incapable of providing. Instead of throttling netflix, customers should be suing their ISP for defrauding them.
I think it's quite simple. If their customers don't get what they are paying for, they will switch to another ISP. In case all ISP's choose to demand such a fee, Netflix needs to complain about anti-competitive collusion.
It's interesting Netflix is framing this this as hurting content creators. I suppose this is probably more true today than it was in 2014 given that original content is now the key drivers for streaming services.
[1] https://www.theverge.com/2014/3/20/5530898/netflix-blasts-co...
Netflix prior to the roll out of their Open Connect CDN offering used Akamai, Limelight, and Level 3 as their CDN providers. When they rolled out Open Connect they offered ISPs the ability to peer directly with them at number of different peering exchanges.[4] This was a few years after the Level 3 Comcast spat. You seem to be confusing events.
[1] https://qz.com/256586/the-inside-story-of-how-netflix-came-t...
[2] https://archive.is/2AC6C#selection-735.154-735.169
[3] https://arstechnica.com/tech-policy/2014/06/fcc-gets-comcast...
If Netflix understood peering from the beginning, they wouldn't have ran into these issues and might have saved themselves some money.
Peering is what saved the Internet back in the late 90's through early 2000's and proved Metcalfe wrong. People using the Netflix problem to push for NN were wrong.
How this is not racket? Your customers are paying you for the service, that they are using whatever they like. If you cannot provide it, someone will.
Requesting content providers to subsidize your business is anticompetitive in some single provider case and cartel in industry wide
If the media URL is totally opaque (Akamai domain, encrypted binary file) I don’t think they would even be able to prove it’s Netflix traffic.
How about Germany pays Netflix because German citizens are watching Netflix too much and are using Netflix infrastructure?
Ridiculous.
Not really. That sort of thinking applies to a specific subgroup in the US, but isn't representative of majority thought.
I know when the NN topic was really hot, many were conflating treating the packets the same with peering agreements. Peering has nothing to do with NN.
Years ago people were complaining about Netflix performance issues and thinking that the ISP was throttling Netflix when it was an issue with peering capacity.
If the rules in the EU mess with peering negotiations, then the rules need to be fixed.