
When Everyone Wants To Watch 'House Of Cards,' Who Pays? - marwei
http://www.npr.org/blogs/money/2014/03/27/295144689/who-pays-when-everyone-wants-to-watch-house-of-cards?utm_medium=facebook&utm_source=npr&utm_campaign=nprnews&utm_content=03272014
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doesnt_know
Ugh, is this even a question anywhere except in the US? The ISP should be
paying for it because that is literally the service they are suppose to be
providing, it's the reason consumers are giving them money.

In what other industry can you accept payment for a service and then try to
make a legitimate claim that you then don't have to provide that service or
maintain the infrastructure you are selling? It's fucking nuts.

When the so called "free market" fails and you have monopolies in place that
are so anti-competitive and anti-consumer, then maybe it's time to go looking
for another solution.

Perhaps this is the situation when it's time to look for some sort of state or
government regulation. Or maybe it's the exact opposite. Perhaps these
companies are in control of tight regulatory procedures that it prevents
competition. I'm not overly familiar with the current system in place in the
US, but whatever the current situation is, you really need to start demanding
the exact opposite.

~~~
adamnemecek
Not to mention the fact that the ISPs got $200 billion from the gov't in order
to provide said infrastructure.

[http://www.pbs.org/cringely/pulpit/2007/pulpit_20070810_0026...](http://www.pbs.org/cringely/pulpit/2007/pulpit_20070810_002683.html)

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Lockyy
I had always assumed that when I paid an ISP for an internet connection that
payment was so that I could send and receive packets across their network.
Clearly I was wrong.

~~~
azurelogic
This is exactly why I agree that this whole mess is a load of crap. Net
neutrality should be a given. If I'm paying for a service, then it should be
up to me how I use it, and the entity that I am paying should not have the
right to arbitrarily alter my traffic. I mean, if you send a letter to someone
popular, that doesn't give the USPS the right to delay your letter. The same
should go for ISPs.

~~~
waps
And what happens if everyone wants to use the same pipe ? Who pays for
expanding that pipe ? Because that's the real question.

> I mean, if you send a letter to someone popular, that doesn't give the USPS
> the right to delay your letter. The same should go for ISPs.

Of course the question is the reverse. If someone wants a letter to be sent to
virtually everyone in America, that person certainly pays by the letter.
Currently that's not what's happening in ISPs, currently sending is free,
provided you "deliver it to the post office" (carrier hotel). The companies
make their profit by charging rent for having a mailbox and delivering mail
for free to those mailboxes. They want to change that.

~~~
noise
In your analogy, sending is not free. Both Netflix has already paid postage to
deliver all of the letters (their CDN/bandwidth costs) and each recipient has
already paid for their mailbox (cable modem service). In this case the ISP
wants Netflix to pay extra money to to deliver their letters even though
everyone has already been paid and they weigh about the same as all the
grocery flyers and other junk mail already cluttering your mailbox (think
youtube).

~~~
waps
Okay, so here's the rub. If ISPs want to talk to eachother, in order to
support "full" bandwidth between them you need n(n-1) connections to support a
bandwidth of n mbit.

 _This is quadratic_. You understand why this won't work ?

Let me put the TLDR here : the infrastructure needed to support the internet
grows quadratic with the number of endpoints on the internet. Meaning
everytime any ISP adds a customer, everyone else's internet _should_ get more
expensive, in order to reflect the real cost of interconnection. Since ISPs
are not about to let that happen, they demand someone else pays for
interconnect.

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drawkbox
_" This is why there are fights right now between Netflix and Internet service
providers. The fight comes down to this: Who's going to pay to keep the videos
running smoothly? Will it be Netflix, which is sending all the data? Or
companies like Time Warner, whose customers, like Rachel, are demanding it?"_

Rachel pays Time Warner for her broadband connection to get her data from
anywhere on the internet, as was sold to her by Time Warner which is the
current day technology that is expected of broadband network access. Time
Warner built their network upon receiving many tax breaks for their prime
market position.

Rachel pays Netflix for the content that comes through the network.

The system is correctly setup except one minor flaw, if Time Warner doesn't
want to pay for it then a competitor can't offer the same service or get the
same funding and breaks they did to compete.

The broadband companies are lethargic dinosaurs, hopefully network access will
go right over their heads (even if by Zuckerberg drones), when wires aren't
needed we can release them.

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al2o3cr
Who pays? The same person who pays for the food to go the "last mile" from the
restaurant kitchen to the table - THE CUSTOMER...

The ISPs appear to be confused about who it is that's paying them for a pipe.
I'll offer them a hint: it's the people you send those rate increase notices
to every 12 months.

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collint
Yikes this article is painfully light on analysis.

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ShabbyDoo
I've always seen local governments as the root cause of "last mile" providers'
ability to turn their customers into the product. Why haven't elected
officials made more stringent demands upon the companies given monopoly (or at
best duopoly) rights to convey bits to and from my home?

I have a condo in Chicago and was delighted to learn that a company was
offering our building last mile connectivity via microwave along with SLAs for
not only bandwidth but latency as well (to which point I don't recall)! Sadly,
the condo board didn't seem so enthralled. Unlike the suburbs, city folk have
more options apparently.

~~~
knodi123
With regards to netflix, it's not always the last mile that's the problem.

Specifically, Netflix's ISP has an agreement with your ISP, which says
essentially "You know what? We send and receive a lot of data. How about I
won't charge you for your data travelling across my network, and you don't
charge me for my data on your network." But then Netflix's ISP transmits
enormous amounts of bandwidth, and your ISP doesn't really get to take an
equal advantage of that reciprocal deal.

It's actually about peering agreements between ISPs. Your ISP wants Netflix's
ISP to foot the bill for the fact that their reciprocal agreement is
statistically just one-sided.

~~~
dm2
The customers of the ISPs are the ones who obtain value and demand fast
delivery of Netflix. The bandwidth from Netflix is something that can't really
be avoided so it is advantageous for both the ISP and Netflix for the ISPs for
cache the content and use Netflix's Open Connect CDN or whatever it's called.

The the ISPs don't deliver and throttle Netflix's bandwidth and it's
noticeable to the customer then hopefully the customer has the option of going
to another ISP.

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LanceH
I would like to see someone do a traceroute and explain the hops, who is
paying at each step, which steps are in dispute, etc...

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jeffdavis
I wonder what would happen if netflix called their bluff?

People all of a sudden start to notice that House Of Cards plays more smoothly
over their 4G cell connection than their expensive cable connection, and how
does Time Warner explain that?

~~~
simoncion
> People all of a sudden start to notice that House Of Cards plays more
> smoothly over their 4G cell connection...

That's not _too_ likely. Most folks (unless their vaguely-savvy 4G-connection-
having not-afraid-to-tether friends clue them in) will decide that Netflix
sucks and stop right there.

As a datapoint, look at Obamacare. Alabama rejected any and all Federal
premium assistance subsidies. This means that in Alabama, regardless of your
ability to pay, or employment status, you pay full price. In California, low-
income folks get reduced or totally subsidized premiums. The talk in Alabama
is _not_ about the insurance is _gobs_ cheaper for poor people in California,
it's about how Obamacare has made insurance so goddamn expensive for everyone.

People are soulcrushingly incurious.

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houseofshards
WTF ?? This argument is so ridiculous. "ISP" stands for Internet Service
Provider as in, an entity that provides an internet service (and maintains the
necessary infrastructure). That is why people pay them.

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qq66
The problem here is that a framework built in one environment (settlement-free
peering) has a lot of problems as the underlying environment has changed.

Let's say everyone in the United States had a second mailbox, and each mailbox
is owned by FedEx, UPS, or DHL. To ship a package, you leave it in your box,
it's picked up by your carrier, transferred to the recipient's carrier, who
then delivers it to their box. Only the sender is billed, and this shipment
fee includes whatever your carrier will have to pay to your recipient's
carrier to complete delivery.

When these mailboxes are built, most people in the country are shipping as
many boxes as they receive, and the number of packages sent by and received by
customers of each carrier are roughly the same (let's say a total of 15,000
per day). So FedEx, UPS, and DHL, to avoid having to track every single
package, just decide to "call it a wash" and deliver each other's boxes for
free, under the assumption that nobody's really getting the upper hand.

Fast forward twenty years, and Jeff Bezos has built Amazon.com at his house.
His house is a UPS house, so UPS picks up 15 million boxes from him every
morning, and hands over 10 million of them to FedEx and DHL for delivery.
FedEx and DHL are billing their customers for 15,000 boxes but also have to
deliver Bezos' 10 million boxes.

You can imagine that they'd want to revisit their original agreement to "call
it a wash" and start billing by the actual package.

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johnvschmitt
This is just ridiculous on so many levels.

So, should we start debating whether UPS should pay for roads directly in each
city?

Are our roads going to start being "content aware" & extorting delivery
service vendors?

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NautilusWave
If Netflix is using Amazon Web Services to run its streaming operations, then
how did Netflix even get involved in this bandwidth issue? Isn't that included
in the bill they pay to Amazon?

~~~
pktgen
They don't use Amazon for streaming videos.

~~~
NautilusWave
I think they do: [http://aws.amazon.com/solutions/case-
studies/netflix/](http://aws.amazon.com/solutions/case-studies/netflix/)

~~~
NautilusWave
From what I can tell, edge caching occurs on AWS as well.

[http://techblog.netflix.com/2013/06/announcing-zuul-edge-
ser...](http://techblog.netflix.com/2013/06/announcing-zuul-edge-service-in-
cloud.html)

[http://techblog.netflix.com/2012/01/ephemeral-volatile-
cachi...](http://techblog.netflix.com/2012/01/ephemeral-volatile-caching-in-
cloud.html)

~~~
elq
I work at netflix.

zuul is used by the netflix API. It's not a cache. It's a request router.

EVCache is used internally for ephemeral systems data - things that would
frequently go into mysql or cassandra but don't really need crash persistence.

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ASneakyFox
I thought this was covered in my internet bill. You know network
communication... if that was supposed to be free all this time some one let me
know because then Ive got to call the police because some one has been
scamming me out of 50 bux every month for the past 2 decades. I suspect there
are more victims.

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EpicEng
>Who's going to pay to keep the videos running smoothly?

...Me? Do I not pay for my internet service? Are ISP's not subsidized to build
infrastructure by my tax dollars? Is my ISP running at a deficit? Yes, yes,
and no, I don't believe so. I pay Netflix for the content, I pay my ISP to
deliver it.

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kashkhan
why should time warner own the last mile? It should be owned by the
homeowners.

~~~
azurelogic
If the homeowner owns the last mile, then they become responsible for
maintenance, ensuring they comply with FCC and other regulations, and
negotiating terms of interconnection. Obviously, that's out of reach of most
of the population, so homeowners don't own the last mile.

~~~
supercanuck
I'm sure there are companies who would provide that service without requiring
ownership

~~~
azurelogic
Yes, and they could even rent you the modem to use with the service! /sarcasm

That's basically an ISP. You pay someone to make sure you stay connected. Then
they become corrupt and try to find new ways to make more money on the deal.

~~~
adamnemecek
Not really no, since you break up the 'pipeline' to be owned by multiple
entities. Replacing one entity in said pipeline is easier if each of them
controls a smaller chunk of the pipeline.

