Broadband Companies Line Up for Their Netflix Deals
Now that Netflix has signed a traffic delivery deal with Comcast, will we see similar pacts with other broadband providers?
Yes, say other broadband providers. Or, more precisely: Other broadband providers say they’ve been in negotiations with Netflix over similar arrangements to the one Netflix and Comcast announced yesterday.
Earlier today, Verizon CEO Lowell McAdam told CNBC that his company has been talking to Netflix about a traffic deal for more than a year, and that he expected Netflix CEO Reed Hastings to pay up, just like he is doing with Comcast.
Us too, says AT&T. Here’s a statement from spokesman Mark Siegel: “We’re in discussions with Netflix to establish a more direct connection between our networks, similar to agreements we have with others, so that AT&T broadband customers who use Netflix can enjoy an even better video experience.”
While plenty of people speculated that Netflix investors would be unhappy with this scenario, that doesn’t seem to be the case: Netflix shares closed up 3 percent today. One possible conclusion you can draw: While neither Comcast or Netflix have revealed the terms of the deal, investors may have concluded that Netflix isn’t paying Comcast, the country’s largest broadband provider, very much to get its video streams through that company’s pipes, and that it won’t have to pay other providers much either.
Comcast owns NBCUniversal, which operates CNBC and is an investor in the company that owns this website.