FCC examining reasons for Internet traffic jams - Yahoo Finance: Former FCC Commissioner Michael Powell, now president of National Cable & Telecommunications Association, blasted Netflix and other unnamed Internet companies for trying to "move the goal posts" to suit their own interests. "They want to protect their profits by ensuring that the disproportionate impact caused by delivering traffic to their customers is spread across all broadband subscribers and not just those who actually use the service," Powell wrote in a blog post earlier this week.
Powell's narrow, outdated cable TV perspective is old school thinking that no longer works given the growing multiplicity of those holding a stake in and benefiting from modern Internet-based telecommunications and its vital role in interstate and international commerce.
Netflix is just one of many services the Internet makes available just as roads and highways bring us both direct benefit when we travel over them and indirect benefit when they bring us goods and services. We need a new way of thinking and a new way of building out and regulating the Internet ecosystem that takes into account this reality.
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Few understand or appreciate the enormous disparity between pricing in the competitive WAN (where Netflix operates) and in the non-competitive MAN (where Comcast and Verizon operate).
The cost per bit differential is as much as 10,000x, making the real issue one of how the cablecos (and the telcos who were late to the video bundle game) can withstand the coming onslaught from Netflix and others for 4/8K VoD.
Whereas HD took 10 years to reach critical market uptake, ultra-high video will happen in 2-3 years. When sports broadcasters and a large enough group of cable content channels decide to break ranks and go with a real-time bundle from Netflix for $20-30 it will be game over for the incumbents.
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