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Cybersecurity & Standards

Netflix-Comcast Deal Puts Spotlight on Interconnection

Netflix and Comcast have reportedly reached a deal under which Netflix will pay to connect directly into Comcast’s network. This resolves an apparent peering dispute which had resulted in slow delivery of Netflix traffic to Comcast subscribers in recent weeks. It also raises some tricky policy questions, and appears to be sparking increased interest in the often overlooked area of Internet interconnection (also known as peering).

In the short term, the result of the agreement will be better network performance for Comcast’s Internet subscribers — certainly for their Netflix traffic, and maybe even for other traffic if it leads to less congestion at interconnection points.

But the long-term picture is much murkier. Will the need for such agreements be largely confined to Netflix, with its incredibly high traffic volume? Or might the big broadband carriers try to make this a more general model — asking content providers to pay up for speedy direct interconnection, or else be relegated to much slower interfaces? If the latter is the direction things go, interconnection could develop into a new way for broadband providers to pick winners and losers online, and a new entry barrier for small and emerging competitors who cannot afford a new layer of charges.

If you think this echoes the concerns at issue in the Internet neutrality debate, you’re right. Traditionally, however, the net neutrality debate focused mainly on the risk of broadband providers playing favorites in the technical routing of traffic across the local networks serving end users. Interconnection involves what happens at the interface points where different carriers hand off traffic to one another. Since the Internet is a “network of networks,” what happens at these interface points has a major impact on how it all works.

Fortunately for Internet users everywhere, the unregulated system of Internet “peering” has functioned pretty well to date, albeit with very limited transparency. The question going forward will be, does Internet interconnection require any kind of policy framework or guidance, or can it be left on auto-pilot? FCC Chairman Tom Wheeler has already included interconnection as one of the key planks of what he calls the “Network Compact.” As the FCC considers both net neutrality and the transition to “all-IP” networks, interconnection questions are likely to arise. The Netflix-Comcast deal is a reminder that interconnection, as arcane a topic as it may seem, may have a big impact on the performance, economics, and openness of the Internet.