Verizon Communications CEO Lowell McAdam on Monday said he expects Netflix to start paying up in a deal that would ensure subscribers of the streaming service get the smoothest possible experience. This is exactly the same deal reached between Netflix and Comcast over the weekend, and could set off a huge precedent for other similar deals in the future. Broadband providers could essentially hold Netflix traffic “hostage” until the streaming service pays up for the increasing data loads. And who is caught in the middle? Paying customers.
McAdam called the deal a “good opportunity,” and said coming to an agreement was in “both of our interests.” The Comcast deal reached its conclusion after over a year of negotiations between the two companies; before the actual “transit agreement” was met, Netflix subscribers experienced a noticeable dip in traffic quality. With broadband providers fed up over the huge volumes of data being sent through their networks, customers are ultimately hung out to dry. Netflix is feeling the brunt by paying up now, but who’s to say customers won’t need to pay more in the future, too?
Broadband providers are not only getting paid by Netflix to provide customers with the streaming content, but by customers in order to even watch that content. These are some huge companies throwing hissy fits, backing Netflix and customers into a corner where really there’s no other option. Even though Netflix’s content is being shuttled directly to broadband providers, therefore giving customers a better experience, the future of streaming services could change. This likely won’t pan out very well over the next year or so.