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Comcast Fee May Lead To Roadblock For Netflix

Stevee Jo Eads |
November 30, 2010 | 3:10 p.m. PST

Staff Reporter

Netflix (Creative Commons)
Netflix (Creative Commons)
Comcast competitors are outraged as it puts a new regulation demanding higher fees in order to stream Netflix videos. 

The fee would particulary hit Level 3 Communications, a content delivery network that delivers Netflix videos from their server to your computer. The company will essentially be forced to pay Comcast a fee in order to stream its videos, which competitors believe is an extreme abuse of power because it will push people to use Comcast instead of Netflix. 

Comcast argues that this new fee is necessary because the online movies and other videos streamed over the network have tremendously increased, which is causing more Internet traffic. 

Level 3 says that charging a fee would violate Federal Communications Commissions guidelines.

“By taking this action, Comcast is effectively putting up a toll booth at the borders of its broadband Internet access network, enabling it to unilaterally decide how much to charge for content which competes with its own cable TV and Xfinity delivered content. This action by Comcast threatens the open Internet and is a clear abuse of the dominant control that Comcast exerts in broadband access markets as the nation’s largest cable provider,” said Thomas Stortz, Level 3's chief legal officer.

There are currently more than 16.7 million Comcast users, which the company argues is not a fair deal. 

"What Level 3 wants is to pressure Comcast into accepting more than a twofold increase in the amount of traffic Level 3 delivers onto Comcast's network— for free," said Vice President of Comcast, Joe Waz.

More than 60,000 people have already signed a petition in opposition to this new fee, which will be sent to the FCC this week. 

Although Level 3 has agreed to pay the fees for now, corporations are waiting to hear if FCC Chairman Julius Genachowski will announce whether or not he will protect the plan that would prohibit corporations like Comcast to do this. 

Reach reporter Stevee Jo Eads here. 



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