> How does the ISP lean on Netflix to pay for its part of their operating costs?
They don't. It's purely your accounting fiction that is attributing those costs to Netflix instead of to the ISP's customers who are using Netflix.
If streaming video increases the ISP's operating costs, they can simply increase prices, preferably through a fair metered usage model that can address all of the video streaming usage costs together, instead of just the Netflix costs.
So if data from company A costs the ISP more that the same quantity of data from company B to get a hold of, how ultimately should this cost be passed on?
Separate metering for end users?
Targeted agreements with large hosts?
Same metering for all, screw those who are frugal with packets.
> So if data from company A costs the ISP more that the same quantity of data from company B to get a hold of,
Expand that hypothetical a bit more, so that we can determine if the situation you're asking about is one that ever happens in the real world. Are you asking about traffic imbalances at peering points? If so, the agreements in those cases are between ISPs and do not include end users like Netflix as a party to the negotiations or payments. The primary purpose of an ISP is to ensure that their subscribers don't have to worry about whose lines their packets might travel on to get to their destination.
Not traffic imbalances at peering points. Rather a situation where data has to travel further, through more nodes from source to destination. Shouldn't a logical system allllow that data to cost more? Or for example through the same number of nodes but more expensive source nodes.
Beyond that, there is some "discrimination" I would be just fine with. For example why should the end consumer pay the cost of YouTube ad data?
The fear is of course discrimination on political or ideological grounds, not just economic. but it would be fairly obvious and nearly impossible technically for an isp to pull that off. And a net neutrality regulation or even ownership at the state or local level would be perfect. You only need net neutrality at the end points where there is no competition, not in the network at large
> Rather a situation where data has to travel further, through more nodes from source to destination. Shouldn't a logical system allllow that data to cost more?
That's not what the cost structure looks like for ISPs, so you would need a pretty good justification for making the price structure look like that. It doesn't necessarily cost the ISP more to have packets travel across more hops within their network; it's more likely to reduce the ISP's expenses by reducing the amount of traffic they have to buy transit for. Where a packet is within the network really only matters and becomes worth tracking when a link gets congested.
They don't. It's purely your accounting fiction that is attributing those costs to Netflix instead of to the ISP's customers who are using Netflix.
If streaming video increases the ISP's operating costs, they can simply increase prices, preferably through a fair metered usage model that can address all of the video streaming usage costs together, instead of just the Netflix costs.