We’ve already heard Netflix executives explain why they signed an Internet deal with Comcast, even though they say they didn’t want to: They say they had to pay Comcast for access to its broadband pipes because their video streams were suffering.
But here’s a new version of the same argument: Netflix says it had to pay Comcast for access to its broadband pipes because Netflix was starting to lose customers.
That’s according to Ken Florance, Netflix’s vice president of content delivery, via a statement he filed with federal regulators this week.
Netflix is opposing Comcast’s attempt to buy Time Warner Cable*, and Florance’s comments are part of a long document Netflix brought to the Federal Communications Commission two days ago (thanks to Quartz for flagging).
Florance has already argued that Comcast forced Netflix to pay for a “transit” deal, by effectively degrading the quality of Netflix streams for Comcast’s broadband customers. (Comcast declined to comment for this post, but has previously argued against Netflix’s arguments).
Now, in his FCC statement, Florance says that Netflix’s Comcast customers noticed, and complained, and in some cases quit paying for Netflix.
“For many [Comcast] subscribers, the bitrate was so poor that Netflix’s streaming video service became unusable,” he writes, then notes that Comcast reps eventually told subscribers to take their beef to Netflix. “Those customers complained to Netflix and some of them canceled their Netflix subscription on the spot, citing the unacceptable quality of Netflix’s video streams and Netflix’s inability to do anything to change the situation.”
Florance doesn’t say how many customers his company lost. But he does include a chart that shows a huge spike in customer complaints last fall, at the same time Netflix said its streams were compromised. The subtext: Guess what happens if Comcast gets even more powerful?
* Comcast owns NBCUniversal, which is an investor in Re/code.
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