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Comment by ubercore | Hacker News Reader

Interesting to see some more details on the appliances. Isn't the argument primarily about peering, not open connect appliances, though?

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It's all one discussion in my mind. There are three ways to get Netflix: boxes, peering, or transit (from cheapest to most expensive). If peering saves the ISP money and the boxes save even more money, why are some ISPs refusing to use them?

Because some ISPs are trying to maximize their revenue by charging Netflix directly.

There are a few other legitimate reasons as well. Some ISPs dislike hosting hardware that they don't own in their data centre. Or it may be that an ISP has contracts in place that commit the ISP to certain bandwidth costs, so removing Netflix traffic may not actually save them money.

Why shouldn't an ISP charge Netflix to host a box in their datacenter? I'd charge you a fee if you wanted to store your DVDs in my house, even if you let me watch them.

Because the box saves the ISP more money than its hosting costs.

On the other hand, if the ISP also runs a video service, they've got some very compelling reasons to do everything they can to not increase the quality of service for Netflix. They're green, and rectangular, and...

Installing these reduces the need for peering dramatically.

And the two are also not mutually exclusive. You can have an OpenConnect appliance that is populated via peering. Someone like Verizon/Comcast/etc could add OpenConnect appliances and then peer with a single 10Gbps link vs the multiple 10Gpbs transit links they are using now.

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