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Netflix to Pay Comcast for Smoother Streaming (WSJ)
Netflix Inc. has agreed to pay Comcast Corp. to ensure Netflix movies and television shows stream smoothly to Comcast customers, a landmark pact that could set a precedent for Netflix’s dealings with other broadband providers, people familiar with the matter said. In exchange for payment, Netflix will get direct access to Comcast’s broadband network. Gizmodo The announcement comes after months of dispute between Netflix and broadband providers about who should pay for increasing bandwidth loads. NYT The deal is a milestone in the history of the Internet, where content providers like Netflix generally have not had to pay for access to the customers of a broadband provider. But the growing power of broadband companies like Comcast, Verizon and AT&T has given those companies increased leverage over sites whose traffic gobbles up chunks of a network’s capacity. Netflix is one of those sites, accounting for nearly 30 percent of all Internet traffic at peak hours. CNNMoney Comcast is the No. 1 cable company in the U.S., with about 23 million subscribers. This announcement comes just 10 days after Comcast entered into an agreement to buy Time Warner Cable. The Washington Post The Netflix deal is controversial because it shows Comcast’s sway over the media and technology industries. With its bid for Time Warner Cable, Comcast would have more than 30 million U.S. Internet subscribers in every major U.S. market, making it powerful in any negotiations for the carriage of programs and apps to cable television and Internet users, analysts say.