Net Neutrality: Is Suspected NFLX Throttling Just the Start?

Without net neutrality, throttling Netflix could be just the start of broadband squeeze

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Net Neutrality: Is Suspected NFLX Throttling Just the Start?

Could anyone besides the cable/broadband providers benefit from the looming combo of Internet throttling and caps?

Companies that will sell you a digital copy of a video that you can download locally might see an uptick in business.

As a Canadian who’s less than impressed with the “Good” Netflix experience, I buy movies and TV shows from Apple’s (AAPL) iTunes. Sure, it costs more, but I store the content locally for easy access at any time, watch on our TVs with an inexpensive Apple TV streamer, and data throttling doesn’t impact viewing. So long as I don’t treat a movie as video-on-demand and instead give it an hour to download, from then on it streams throughout the house at the speed of my Wi-Fi network.

Of course, Google is looking pretty good too, with its Google Fiber broadband which is lightning fast compared to any other ISP.

Bottom Line

The icing on the cake is the proposed merger between Comcast and Time Warner Cable (TWC). When you essentially remove net neutrality, that’s one thing, but consolidation is really going to exacerbate the situation.

Under the scenario playing by out the end of the year, the broadband providers control how much Internet data a home gets and what quality they will receive with streaming and connected services, and consolidation means consumers will have few alternatives.

For consumers, things are looking rather dire at the moment, and it could get even worse.

*Note: Comcast is contractually bound to follow net neutrality laws until 2018, which means it can’t actively throttle NFLX — but it can allow Netflix performance to degrade by not upgrading its network specifically to keep up with NFLX traffic (for example, by not implementing Netflix Open Connect video caching).

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, http://investorplace.com/2014/02/net-neutrality-nflx-2/.

©2014 InvestorPlace Media, LLC

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