Is there “something rotten” in the online video streaming market? No. It’s a booming and hugely innovative arena. But last week several observers speculated that Verizon and Comcast were purposely slowing Netflix video streams, invoking — as usual — the all-purpose net neutrality violation.
It was true, Netflix’s “ISP index” showed download speeds of its videos on Verizon and Comcast networks slowing down. But Netflix came forward (0) and said neither Verizon nor Comcast is “throttling” its traffic. In fact, it is doubtful that either company even has the ability to do so in any sophisticated way. So what’s going on?
Most likely, Netflix simply isn’t buying enough interconnection bandwidth from these broadband service providers. Recently, Netflix began offering its SuperHD content, which requires more capacity, to all of its subscribers, and perhaps it hasn’t boosted its interconnection capacity to some networks. That might explain why speeds are dropping on some networks and not others.
Regardless of the facts of this case, which are still trickling out, this dustup suggests a refresher course in Internet interconnection and peering practices. It’s often said the Internet is a network of networks, and interconnection and peering refer to the technical means and business relationships various networks use to exchange data traffic. From the beginning, interconnection practices have changed as the content and complexity of networks changed. The complexity of networks and the number of players is now growing faster than ever, and the massive streams of video from ESPN, HBO-GO, Netflix, YouTube, Apple, Amazon, Twitch, and others is once again changing the technical necessities and economics of the Net.
Long ago, when most data consisted of email and webpages, traffic was roughly symmetrical — that is, most networks sent each other similar amounts of traffic. But today, Web video means floods of asymmetric traffic. Netflix, for example, sends other networks vastly more traffic than it receives from them. It’s all downstream. This changes the economics — and the relationships among networks.
Since the beginning, there have been peering and interconnection disputes. But networks have always found ways to resolve differences — without interference from Washington. Judging by the overwhelming success of the Internet, the process has worked remarkably well.
Next week, I am publishing “A Brief History of Internet Interconnection,” which will explain the technical and economic relationships and, through network maps, show how much the network has changed (and will continue to change) over time.
In the meantime, I can recommend this great video from George Ou that explains what happened in a similar episode (the Comcast-Level 3-Netflix spat) a few years ago, and along the way helps show how the Net works.