Netflix has reached a deal with AT&T that will see the video streaming service having direct connection to AT&T's network. The goal here is to reduce buffering and increase streaming performance for Netflix subscribers.
This deal is similar to deals Netflix made with both Verizon and Comcast, and no doubt we might see Netflix CEO taking to social media or company meetings with complaints about the new AT&T deal.
Both Netflix and AT&T failed to disclose the terms of the deal, so we have no idea how much money Netflix is paying AT&T and whether or not these fees will come back to haunt Netflix subscribers in the long run.
Unknown to subscribers, AT&T and Netflix came to a deal back in May of this year, but the telecom company is only now turning up the speed. This means Netflix subscribers, who are also subscribed to AT&T, should see a boost in speed when watching videos.
"We reached an interconnect agreement with Netflix in May and since then have been working together to provision additional interconnect capacity to improve the viewing experience for our mutual subscribers," an AT&T spokeswoman said in a statement. "We're now beginning to turn up the connections, a process that should be complete in the coming days."
Back in March of this year, AT&T rejected a request from Netflix to interconnect for free. AT&T and other broadband providers believe that Netflix should bear the cost for the recent surge in video traffic. Netflix didn't take these claims sitting down; the company fired back by saying broadband providers should be responsible for making sure that their subscribers get the content they are viewing online in a reliable manner.
In the past, interconnection deals have been free, but that has all changed. These days, providers require fees paid to them. Some fear that moves like this could have a serious problem on startups, especially if the content they provide is used by many over the Internet.
Net neutrality groups are pushing for the FCC to intervene in these situations and stop broadband providers from asking for a fee. However, at the rate things are going right now, such changes might take a long time to happen, or never at all.
