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Ninja Rope
Oct 22, 2005

Wee.
You're confusing two scenarios. Net neutrality refers to ISPs throttling bandwidth to various sites unless they pay them money to get not-intentionally-degraded service. This is what happened between Netflix and Comcast. The solution here was that Netflix pays Comcast to not have their traffic throttled, and the manner in which this is currently implemented is by Netflix and Comcast peering directly.

Peering is where two companies (Netflix and Comcast) connect their networks directly to each other, meaning no third-party ISP is paid to carry traffic between them. Usually this occurs in locations where the two companies both already have network devices, like in a large datacenter. There is little cost to peering with another company: you might have to buy some cables and another port on your router, but the total cost is negligible compared to paying an ISP monthly to carry your bits.

So in this case, Netflix has to pay Comcast to allow both companies to save money by peering directly. That is, without this agreement both Netflix and Comcast need to pay an ISP to connect them. With this agreement, Netflix has to pay Comcast instead of paying an ISP, but Comcast saves money by not having to pay that ISP and makes money from Netflix. They're double-dipping without even taking into account their customers who pay to get access to Netflix.

Co-locating a server inside an ISP is similar economically to peering, but is not related to net neutrality and isn't what is occurring between Netflix and Comcast.

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Ninja Rope
Oct 22, 2005

Wee.
There's no way to prove or disprove that Comcast was throttling Netflix specifically, but reports of Netflix working better over a VPN make it sound as if they were. Even if it was just a peering dispute with Cogent it's a symptom of the same issue, Comcast refusing to fix a problem until they're paid, not by their customers but by a content provider, to do so. Comcast could have solved the Cogent issue by peering directly with Netflix for free but chose not to. While requiring net neutrality wouldn't have solved this if Comcast was not intentionally throttling traffic, it would go a long way against curbing that abuse in the future, especially now that there is a high-profile case of an ISP refusing free peering and profiting from it and other ISPs are following suit.

Ninja Rope
Oct 22, 2005

Wee.

adorai posted:

Comcast should have become an ISP for Netflix, for free?

Yes. Prior to the deal Comcast was paying to receive Netflix traffic. Peering for free with Netflix not only saves Comcast money but is the thing customers are paying them to do: provide fast access to the whole internet. Even better if it can be done on the cheap and (theoretically) lowering the customer's own bill. That's an upside to being a giant ISP: everyone wants to peer with you for free.

adorai posted:

There is nothing stopping you from laying fiber in your own neighborhood and competing with Comcast in the same manner. Apply for carrier status and get super cheap permitting.

Disregarding the many millions of dollars it costs to lay fiber and the massive interruption to traffic, every city has different right-of-way laws regarding who can lay fiber. Even if you have the money you may be barred from laying cables.

Ninja Rope
Oct 22, 2005

Wee.

Ignoarints posted:

I don't think anybody could really argue against the fact that perhaps it might be reasonable that Netflix, which accounted for a disproportionately huge amount of bandwidth, should pay some for bandwidth.

That's why Netflix goes out of their way to peer with and provide openconnect boxes to anyone who wants them. It's not in their interest to be a problem for ISPs. Same goes for all of the major CDNs.

I get your point though. If the ISP business isn't profitable enough in the common carrier model I suppose Comcast could make some additional money by selling TV shows online?

Ninja Rope
Oct 22, 2005

Wee.

SamDabbers posted:

Whether Netflix pays somebody (e.g. Cogent, Level3) for transit, or maintains their own infrastructure to peer with other networks, they're definitely paying for their own bandwidth.

It's also worth noting that anyone receiving Netflix traffic is also paying for transit to receive it. Peering saves money on both sides and reduces latency.

Ninja Rope
Oct 22, 2005

Wee.
Peering, compared to transit, is effectively free. Netflix is paying Comcast for something that costs Comcast just a little more than $0, and saves Comcast tens of thousands on transit fees. Netflix is paying Comcast to save money.

Ninja Rope
Oct 22, 2005

Wee.

Install Windows posted:

So you're saying Netflix should get to use a connection to Comcast's networks for free? Why does the multibillion dollar company deserve that and the residential customers don't?

Like I said before, yes. Comcast should take the option that saves money and peer with Netflix. They are refusing to do what is in their customers' best interest and save themselves money while providing a better product because it hurts a (partial) competitor, disregarding that doing so also hurts their customers.

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Ninja Rope
Oct 22, 2005

Wee.

Install Windows posted:

Plus it would literally be saving Netflix millions of dollars a year they don't have to pay to transit providers for absolutely no benefit to Comcast.

Comcast has to pay a transit provider to receive traffic. If they peer directly, Comcast saves a significant amount of money.

Install Windows posted:

Why should Netflix get to be the one company in the world that gets to have direct connectivity for free, but everyone else has to pay Comcast or regular transit providers?

Comcast peers for free with a number of organizations. They specifically don't peer for free with Netflix because they can squeeze money out of them.

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