Netflix opposes the Comcast/Time Warner Cable deal not...

is not about protecting the consumer,” said Comcast, in response to a letter sent by Netflix to Sen. Al Franken, D-Minn., about the deal (http://1.usa.gov/1lK0pEy). “The fact that Netflix paid to protect our consumers is evidence of Comcast’s power,” said Netflix. “Acquiring Time Warner Cable will only increase this leverage.” Comcast’s paid-peering deal with Netflix (CD Feb 25 p2) is “nothing unprecedented,” the cable company said. Netflix approached Comcast to set up the deal, cutting out the wholesaler transit companies -- such as Akamai, Cogent, and Level 3 -- it had used in the past, Comcast said. “This arrangement was thus about Netflix exercising its market power to extract a more favorable arrangement directly from Comcast,” said the cable company. Netflix said this wasn’t the case in its letter to Franken. “Netflix agreed to paid peering with Comcast to reverse an unacceptable decline in our members’ video experience,” said the letter. “Our agreement with Comcast is the first time that Netflix was forced to pay an ISP for what amounts to access to their subscribers.” If Netflix doesn’t like the arrangement, Netflix could work with a transit company instead, Comcast said. “Netflix can work with any of the multiplicity of partners that connect with Comcast. There was and is no need for Netflix or any other Internet content provider to work directly with us or any other specific ISP.” Netflix argued that, regardless, the pathways provided by transit companies are still ultimately controlled by Comcast. “Every transit provider must ultimately negotiate with Comcast for a connection to Comcast’s network and Comcast controls the terms of that access,” Netflix said. Using that argument in opposition to the Comcast/TWC deal is “unfounded,” Comcast said, because it applies to the industry as a whole. “Netflix’s arguments are not transaction specific,” Comcast said.