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Netflix Gives In, Will Pay Comcast to Improve Streaming

Issue brings up concerns over net neutrality


Comcast (CMCSA) and Netflix (NFLX) have announced a new deal in which the streaming TV and movie service will pay Comcast for faster service for its customers.

netflix nflx stockThe move means that other content providers may have to start paying cable providers for faster service — meaning a higher cost for consumers.

As Forbes notes, “Thanks to the popularity of shows like House of Cards, Netflix accounts for roughly 30% of broadband traffic. Prior to cutting the deal with Comcast, Netflix got access to Comcast through so-called content distribution networks (CDNs).”

Netflix is now paying Comcast to stream its content at a higher and faster level of service.

Getting your Orange is the New Black series to load quicker and stream faster, however, also comes with a different cost (via CBS News):

The arrangement comes as federal regulators are wrestling with an issue known as “Net neutrality” concerning broadband providers and whether they can slow down traffic to particular websites, potentially forcing content companies to pay for faster Web service.

The Federal Communications Commission said last week it plans to rewrite the rules after a federal court struck down the commission’s previous version.

Netflix has 44 million subscribers worldwide.

NFLX stock is up 140% from this time last year.


Article printed from InvestorPlace Media,

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