WHAT NETFLIX-COMCAST DEAL MEANS FOR VIEWERS
After years of bickering, Netflix and Comcast are working together to provide their subscribers with a more enjoyable experience when they’re watching movies and old television shows over high-speed Internet connections.
The new partnership is part of a breakthrough announced Sunday that requires Comcast’s Internet service to create new avenues for Netflix’s video to travel on its way to TVs and other devices. In return for the improved access, Netflix will pay Comcast an undisclosed amount of money for the next few years.
The arrangement represents an about-face for Netflix Inc., which had steadfastly refused to pay high-speed Internet service providers already collecting $40 to $60 per month from its customers. Netflix CEO Reed Hastings had contended that his company’s Internet video service is one of the main reasons why households pay for broadband, making it unreasonable for Internet service providers such as Comcast Corp. to demand additional money from content providers.
Comcast and other broadband providers argued Netflix’s growing popularity should require the Los Gatos, Calif., company to shoulder some of the financial burden for delivering its video. In evening hours, Netflix’s 33 million U.S. subscribers generate nearly a third of the Internet’s downloading activity, according to the research firm Sandvine.
Now that Netflix has relented to Comcast, the largest U.S. broadband service, similar deals are more likely to be reached with other Internet providers.
Here’s a closer look at what this shift means for subscribers to Netflix and high-speed Internet services: