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Netflix adds 3D and Super HD - Page 44

post #1291 of 1798
Quote:
Originally Posted by keenan View Post

Is this the wrong thread for the above question?

It is kind of off-topic, having nothing to do with Netflix 3D or Super HD. How about the "Netflix streaming quality" or "Best possible Netflix streaming device" threads?
post #1292 of 1798
Quote:
Originally Posted by Apostate View Post

Man, you really don't get it. Corner bakery is not CDN. Corner bakery is ISP in your example.

In the relationship between Netflix and the CDNs, Netflix pays them money and they deliver Netflix's content through their distributed server networks. Netflix needs their services; they need Netflix's money--symbiosis. I go to the corner bakery and give them my money and they give me bread; they need my money and I need their bread--symbiosis. Netflix, however, can and have built a distributed server network of their own and can do what the CDNs do for them for themselves; similarly I can bake my own bread--I have everything I need to bake a loaf of bread right now if I want to, including types of bread that my bakery doesn't offer. My corner bakery can't do anything for me that I couldn't conceivably do for myself, just as the CDNs can't do anything for Netflix that they can't do for themselves, except deliver their content to customers whose ISPs have declined to bring Open Connect into their networks. On the other hand, the ISPs' relationship to the CDNs, including Netflix's CDN, is different--the ISPs own the final mile of cable connecting your home and mine to the Internet and only they can bring Netflix's product to our doors, regardless of whose CDN delivers it to their "door". The ISPs do for Netflix and the other CDNs what neither can or ever will be able to do for themselves.
Quote:
If you are going to make a guess, make a guess based on logic and plausibility. You are basing your guess on baseless non-sense.

Your guess is that Netflix is approaching ISPs and saying, "We realize that the CDNs who deliver our content to you now are paying you money to do it. Instead, we want you to deliver our content as brought to you via our private CDN but we're not going to pay you to do it. Sound good?". That presumption is based on logic rolleyes.gif?

I withdraw the offensive "out of your behind" comment, but I honestly don't see how you arrive at the conclusion that Netflix is asking ISPs to accept their content without payment when they're paid to take it from the CDNs that Netflix currently uses. Why would any ISP agree to connect to Open Connect under those conditions and why would anyone at Netflix think that they might? I don't believe that it's either reasonable or logical to assume that that's what's happening.
Quote:
Why would ISPs turn down paying customer? They wouldn't. Again these are basic business concepts... cost vs benefit, etc. etc.

Sure they would. I doubt that Netflix is offering them any more on an ongoing basis than they're getting from the other CDNs so there is no opportunity to increase profit. The disincentive for the larger ISPs is that it enables Netflix to afford to enhance their product for their customers, making it even more competitive with the IP streaming video services which they (the larger ISPs) offer now or plan to offer in the future.

In the year old announcement of Open Connect in Netflix's blog they point out that YouTube has been delivering their content over a private CDN for years. I wonder what their relationship with the ISPs is like?
Quote:
Really? Threaten your customers with higher cost?

I'm sorry, but where did you find a threat in that statement? It's an explanation, pure and simple. It's not a suggestion that they'll raise their prices, just a statement that delivering Super HD and 3D video through the CDNs that they use today would cost them more, taking a bite out of their profit margins with no promise of return, so they're not going to do it.

In the end, the status quo hurts neither Netflix or the ISPs who decline to add Open Connect access to their networks. Those ISPs are delivering the same level of Netflix service that they always have and realizing, presumably, the same profits for doing it. Netflix profits are, as report in April, quite healthy. If any of the big ISPs who currently balk at "joining the Open Connect club" change their minds, some of their Netflix using customers may benefit in ways that they can appreciate; others won't. Netflix will continue to operate their Open Connect CDN and continue to reap a savings for delivering their content to customers whose ISPs are set up for it, whose numbers will increase by-and-by, if only through growth of those ISPs.
post #1293 of 1798
Reading all of this is confusing sorry but I am a college dropout but I just wonder for Open Connect users does anything you watch even SD programs go through Open Connect or does some programs still go through AWS etc.
post #1294 of 1798
Quote:
Originally Posted by lovinthehd View Post

Could be but how do you have the PS3 set for audio output? Bitstream? LPCM?

Quote:
Originally Posted by michaeltscott View Post

It is kind of off-topic, having nothing to do with Netflix 3D or Super HD. How about the "Netflix streaming quality" or "Best possible Netflix streaming device" threads?
Thanks, I thought there might have been a more appropriate thread. Turns out the decoding on the Denon AVR had been changed to DTS for some odd reason, on both inputs from devices that feed Netflix audio(WDTV Live and PS3) to the AVR, I switched it back to DD and all is good!

Thanks
post #1295 of 1798
Quote:
Originally Posted by michaeltscott View Post

In the relationship between Netflix and the CDNs, Netflix pays them money and they deliver Netflix's content through their distributed server networks. Netflix needs their services; they need Netflix's money--symbiosis. I go to the corner bakery and give them my money and they give me bread; they need my money and I need their bread--symbiosis. Netflix, however, can and have built a distributed server network of their own and can do what the CDNs do for them for themselves; similarly I can bake my own bread--I have everything I need to bake a loaf of bread right now if I want to, including types of bread that my bakery doesn't offer. My corner bakery can't do anything for me that I couldn't conceivably do for myself, just as the CDNs can't do anything for Netflix that they can't do for themselves, except deliver their content to customers whose ISPs have declined to bring Open Connect into their networks. On the other hand, the ISPs' relationship to the CDNs, including Netflix's CDN, is different--the ISPs own the final mile of cable connecting your home and mine to the Internet and only they can bring Netflix's product to our doors, regardless of whose CDN delivers it to their "door". The ISPs do for Netflix and the other CDNs what neither can or ever will be able to do for themselves.

Seriously. Are you being intentionally dense? Your analogy is all over the place. I am not going to waste my time parsing your example but I'll give you a hint or three. First, define "bread." What is bread respresenting? Then think of your role (no pun intended) relative to bread. Are you a maker or a taker? Finally, replace the representative term like Corner Bakery with the actual "thing" like ISP or CDN, and check to see if the analogy still makes sense.
Quote:
Your guess is that Netflix is approaching ISPs and saying, "We realize that the CDNs who deliver our content to you now are paying you money to do it. Instead, we want you to deliver our content as brought to you via our private CDN but we're not going to pay you to do it. Sound good?". That presumption is based on logic rolleyes.gif?

Yup, even though I have mentioned the rationale several times before, I'll try to summarize for your easy consumption.

1) Netflix got Open Connect to reduce their long-term transit cost, yes?

2) Netflix believes building and running Open Connect will be cheaper than "renting" CDNs' services in the long run, yes?

3) However, until transition to Open Connect is complete, i.e. right now, Netflix has to pay for both Open Connect and 3rd party CDNs, yes?

4) So to save money, Netflix needs to get rid of 3rd party CDNs real quick, yes?

5) So Netflix needs ISPs to take Open Connect ASAP, yes? But that's not happening. Why not?

6) If Netfllix paid ISPs like a normal CDN, the probability of Open Connect happening would be higher, yes? But what would be the cost structure? Instead of CDN, Netflix would be paying ISP, yes?

7) Is Netflix better off cost-wise in this scenario? Not really. Netflix would be even better off if Netflix didn't have to pay ISPs, yes? Does Netflix have the market share and support of its customers to, I don't know, strong-arm ISPs who everyone thinks sucks anyway?

Does this train of thought sound logical to you?

Oh, there's that thing about Netflix being so strenous about Open Connect being free. Free for whom, Netflix didn't say.tongue.gif Lastly, why hasn't Netflix been successful? Simply, Netflix needs ISPs more than ISPs need Netflix.
Quote:
I withdraw the offensive "out of your behind" comment, but I honestly don't see how you arrive at the conclusion that Netflix is asking ISPs to accept their content without payment when they're paid to take it from the CDNs that Netflix currently uses. Why would any ISP agree to connect to Open Connect under those conditions and why would anyone at Netflix think that they might? I don't believe that it's either reasonable or logical to assume that that's what's happening.

rolleyes.gif Do you realize that you come off as an insufferable nitwit? You withdraw the offensive comment? What was the other phrase? You grant me "symbiotic"? This is why I think you are some young kid who thinks he knows everything, A normal grown-up will admit and apologize for the wrong and not worry about losing face and their internet rep. Actually a grown-up wil not have caused offense in the first place.
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Sure they would. I doubt that Netflix is offering them any more on an ongoing basis than they're getting from the other CDNs so there is no opportunity to increase profit. The disincentive for the larger ISPs is that it enables Netflix to afford to enhance their product for their customers, making it even more competitive with the IP streaming video services which they (the larger ISPs) offer now or plan to offer in the future.

You are right in this one. Benefit can be other things than money. Whatever the reason, ISPs don't see that benefits outweigh the cost of Open Connect.
Quote:
In the year old announcement of Open Connect in Netflix's blog they point out that YouTube has been delivering their content over a private CDN for years. I wonder what their relationship with the ISPs is like?

Youtube is owned by Google, the proverbial 800-lb gorilla. Enough said right there.
Quote:
I'm sorry, but where did you find a threat in that statement? It's an explanation, pure and simple. It's not a suggestion that they'll raise their prices, just a statement that delivering Super HD and 3D video through the CDNs that they use today would cost them more, taking a bite out of their profit margins with no promise of return, so they're not going to do it.

Hmm... Netflix tells me that things are costing more. What am I to infer from that? rolleyes.gif
Quote:
In the end, the status quo hurts neither Netflix or the ISPs who decline to add Open Connect access to their networks. Those ISPs are delivering the same level of Netflix service that they always have and realizing, presumably, the same profits for doing it. Netflix profits are, as report in April, quite healthy. If any of the big ISPs who currently balk at "joining the Open Connect club" change their minds, some of their Netflix using customers may benefit in ways that they can appreciate; others won't. Netflix will continue to operate their Open Connect CDN and continue to reap a savings for delivering their content to customers whose ISPs are set up for it, whose numbers will increase by-and-by, if only through growth of those ISPs.

You think Netflix profits are healthy??? eek.gif $2.6 million profit on $1.02 billion revenue? Are you kidding? That's 0.25% proft margin! Talk about paper thin. Netflix is living dangerously. One bad quarter can ruin Netflix.
Edited by Apostate - 6/28/13 at 8:47am
post #1296 of 1798
This thread has dropped ship and is now just a bickering match and should be closed.
post #1297 of 1798
Or some members will need t have their posting privileges revoked.
post #1298 of 1798
Quote:
Originally Posted by Apostate View Post

.
rolleyes.gif Do you realize that you come off as an insufferable nitwit? You withdraw the offensive comment? What was the other phrase? You grant me "symbiotic"? This is why I think you are some young kid who thinks he knows everything, A normal grown-up will admit and apologize for the wrong and not worry about losing face and their internet rep. Actually a grown-up wil not have caused offense in the first place.
.


That may be your perception, but on the many Netflix streaming threads that he contributes to, I find Michaelscott's posts very helpful and informative. And I'm grateful for his input.
post #1299 of 1798
Me too MichaelScott has even gone out of the way loading episodes of shows he never watched when I had problems with them too see if it was on my end even running tests like pulling the Ethernet cable too see how long the buffer was as I said for the PS3 and Roku. I don't alway agree with what he says but he has gone out of his way for me when I have streaming problems.
post #1300 of 1798
I always thought Michael's contribution to this thread was very positive. He helped a lot of people including me.
post #1301 of 1798
Yep, seems ol' apostate needs a prostrate adjustment...
post #1302 of 1798
Quote:
Originally Posted by Vishwa Somayaji View Post

I always thought Michael's contribution to this thread was very positive. He helped a lot of people including me.

+1
post #1303 of 1798
Quote:
Originally Posted by lovinthehd View Post

Yep, seems ol' apostate needs a prostrate adjustment...

"prostrate adjustment"? That's a new one for me... smile.gif
post #1304 of 1798
Quote:
Originally Posted by lujan View Post

Quote:
Originally Posted by lovinthehd View Post

Yep, seems ol' apostate needs a prostrate adjustment...

"prostrate adjustment"? That's a new one for me... smile.gif

Maybe I should have said massage...
post #1305 of 1798
Quote:
Originally Posted by Vishwa Somayaji View Post

I always thought Michael's contribution to this thread was very positive. He helped a lot of people including me.

I agree. I would also like to add in defense of Mike's position in regards to Open Connect, that I have contacted a spokesman at Cablevision, and although he could not give me specifics due to confidentiality agreements, the partnership between Cablevision and Netflix does require an a undisclosed financial arrangement between the two party's. There's no free lunch there for Netflix. As I have posted before, if TWC and Comcast are unwilling to offer Open Connect to their subscribers, it may have more to do with their marketing strategy and relationship with competing networks like HBO and Showtime, which are prime targets for Netflix, rather then Netflix's reluctance to pay the piper, unless Netflix felt that they were asking for unreasonable fees.


Ian wink.gif
Edited by mailiang - 6/28/13 at 5:45pm
post #1306 of 1798
Quote:
Originally Posted by lovinthehd View Post

Quote:
Originally Posted by lujan View Post

Quote:
Originally Posted by lovinthehd View Post

Yep, seems ol' apostate needs a prostrate adjustment...
"prostrate adjustment"? That's a new one for me... smile.gif
Maybe I should have said massage...

biggrin.gif So you think I should get a massage while lying down? That does sound pretty good. cool.gif
post #1307 of 1798
Quote:
Originally Posted by mailiang View Post

I agree. I would also like to add in defense of Mike's position in regards to Open Connect, that I have contacted a spokesman at Cablevision, and although he could not give me specifics due to confidentiality agreements, the partnership between Cablevision and Netflix does require an a undisclosed financial arrangement between the two party's. There's no free lunch there for Netflix.

Actually you are defending my position, mailiang. rolleyes.gif
post #1308 of 1798
Quote:
Originally Posted by Apostate View Post

Actually you are defending my position, mailiang. rolleyes.gif

I can't wait to hear you spin that. An indication that Cablevision is being paid by Netflix to bring Open Connect into their networks supports your position that Netflix is being rejected by ISPs because they're asking them to forego payment? Please, tell us how.
post #1309 of 1798
Quote:
Originally Posted by Apostate View Post

Actually you are defending my position, mailiang. rolleyes.gif

Really? And did you read the rest of my post? Maybe I'm missing something so correct me if I'm wrong. Your original comments criticized Netflix for avoiding a reasonable pay out to the ISP's.

Quote:
Originally Posted by Apostate View Post

Don't really hear much about SuperHD and 3D anymore.

Netflix just should pay the ISPs like any other CDNs and give the customers SuperHD and 3D instead of pretending that it's the ISPs who are preventing SuperHD/3D when Netflix damn well knows it's Netflix who's doing the preventing. mad.gif

My point is, that If Netflix doesn't have an agreement with an ISP, it may be because they were unable to settle on a fee. It's also possible that unlike Cablevision, Comcast and TWC have different priorities when it comes to their marketing strategy. You can't blame Netflix for preventing their customers from receiving SuperHD/3D if you're not privy to the financial negotiations that incurred with the ISP's.


Ian
post #1310 of 1798
For Super HD is it supposed to be available from the Windows 8 app? I recently got a refurb, HP Core i5, PC and I've tried the example short from the Windows 8 app, but it doesn't go past the 3850kbps, 1080P stream.
Edited by aaronwt - 6/29/13 at 12:59pm
post #1311 of 1798
Quote:
Originally Posted by aaronwt View Post

For Super HD is it supposed to be available from the Windows 8 app? I recently got a refurb HP Core i5 PC and I've tried the example short from the Windows 8 app, but it does't go past the 3850kbps stream.

Yes, Super HD is available in the Win8 app; "Example Short" gets up to 5800 Kbps for me on this PC, I just ran it to be sure. Bring up the Stream Manager (CTRL-ALT-SHIFT-S) to get a list of the available video encode and an indicator of which one is being displayed and which one is being buffered.

You should also get 5.1 sound if your PC has HDMI sound out.
post #1312 of 1798
Quote:
Originally Posted by michaeltscott View Post

Yes, Super HD is available in the Win8 app; "Example Short" gets up to 5800 Kbps for me on this PC, I just ran it to be sure. Bring up the Stream Manager (CTRL-ALT-SHIFT-S) to get a list of the available video encode and an indicator of which one is being displayed and which one is being buffered.

You should also get 5.1 sound if your PC has HDMI sound out.

Ok. Thanks. It must be an issue with unBlock US right now. When I check the available encodes it isn't showing anything higher than 3850.
post #1313 of 1798
Quote:
Originally Posted by michaeltscott View Post

I can't wait to hear you spin that. An indication that Cablevision is being paid by Netflix to bring Open Connect into their networks supports your position that Netflix is being rejected by ISPs because they're asking them to forego payment? Please, tell us how.

biggrin.gif Ah, there you are. Been skulking, have we? Pouncing on perceived opening, are we? Sorry to disappoint but there is nothing to spin. wink.gif If you read my reply to you above posted above, you'll see that I've made mailiang's point already:
Quote:
5) So Netflix needs ISPs to take Open Connect ASAP, yes? But that's not happening. Why not?

6) If Netfllix paid ISPs like a normal CDN, the probability of Open Connect happening would be higher, yes? But what would be the cost structure? Instead of CDN, Netflix would be paying ISP, yes?

7) Is Netflix better off cost-wise in this scenario? Not really. Netflix would be even better off if Netflix didn't have to pay ISPs, yes? Does Netflix have the market share and support of its customers to, I don't know, strong-arm ISPs who everyone thinks sucks anyway?

I believe point number 6 states that best way for Netflix to get ISPs to take Open Connect is to pay ISPs like a normal CDN, which I believe Netflix is doing with Cablevision per mailiang. I am sure Netflix would rather not pay Cablevision considering its financial situation but with the lackluster results of its campaign to pressure ISPs using the customers, I am guessing Netflix didn't have much of a choice. It looks like Netflix blinked first. This actually makes me hopeful that Netflix may comes to terms with larger ISPs and that I, a Fios user, may get SuperHD/3D after all.cool.gif
post #1314 of 1798
Quote:
Originally Posted by mailiang View Post

Really? And did you read the rest of my post? Maybe I'm missing something so correct me if I'm wrong. Your original comments criticized Netflix for avoiding a reasonable pay out to the ISP's.
My point is, that If Netflix doesn't have an agreement with an ISP, it may be because they were unable to settle on a fee. It's also possible that unlike Cablevision, Comcast and TWC have different priorities when it comes to their marketing strategy. You can't blame Netflix for preventing their customers from receiving SuperHD/3D if you're not privy to the financial negotiations that incurred with the ISP's.

Yes, mailiang. That's what I said. tongue.gif See my response to michaeltscott. Don't let your love for him blind you. wink.gif
post #1315 of 1798
Quote:
Originally Posted by Apostate View Post

Yes, mailiang. That's what I said. tongue.gif See my response to michaeltscott. Don't let your love for him blind you. wink.gif

My opinion is my own. It's not my fault that Mike and I agree. tongue.gif You need to learn how to read, so let me say this one more time. My point is, you are being presumptuous by claiming that Netflix is not being reasonable when it comes to paying ISP fees. You have no data to support such a claim and never will due to the confidential nature of these type of negotiations. Welcome to the world of TV! Now get a life and move on, please.


Ian
Edited by mailiang - 6/29/13 at 3:27pm
post #1316 of 1798
Quote:
Originally Posted by Apostate View Post

biggrin.gif Ah, there you are. Been skulking, have we?

Nope--I wrote a long reply yesterday morning which I thought I'd posted but is no where to be seen. It's still in a Notepad buffer on my desktop--I'll review it and post it later.
Quote:
I believe point number 6 states that best way for Netflix to get ISPs to take Open Connect is to pay ISPs like a normal CDN, which I believe Netflix is doing with Cablevision per mailiang. I am sure Netflix would rather not pay Cablevision considering its financial situation but with the lackluster results of its campaign to pressure ISPs using the customers, I am guessing Netflix didn't have much of a choice. It looks like Netflix blinked first. This actually makes me hopeful that Netflix may comes to terms with larger ISPs and that I, a Fios user, may get SuperHD/3D after all.cool.gif

Your principle conjecture is that Netflix has been asking the ISPs to take traffic via Open Connect into their networks without payment when the CDNs have been paying them to accept Netflix's streams. I don't believe that they ever asked the ISPs to accept that deal and that the ISPs who have not made a deal to "carry" Open Connect have not done so for reasons unrelated to potential loss of that revenue. Now you want to claim that Cablevision was offered the deal and rejected it and that Netflix caved, saying that that was also covered by your theory (a portion of it revealed only yesterday). Since I never believed that Netflix tried to get any ISP to accept a deal which didn't include payment, it fits my theory better.

Sure Netflix would rather not pay the ISPs; everyone would rather get everything for free. I want to buy a new car at dealer cost or below, but I don't walk into a dealership expecting to drive away with one. I don't think that Netflix ever created a business plan around getting Open Connect into ISP networks for free.

Cablevision was Netflix's Open Connect "poster child", a cable MSO with 3.5 million basic subs, the largest US ISP to have accepted the deal at the time of their Super-HD/3D-via-Open-Connect-only announcement. (Google Fiber was also famously onboard at that point, but their customer base is negligible). Since then Cox Communications (4.5 M basic subs) has accepted a deal for connection to OC, as has Suddenlink (1.2 M). Combined, along with the sundry small local ISPs, they represent only a fraction of the Netflix customers served by the hold-outs.

Hey people, don't be shy--chime in! Does anyone other than Apostate believe that Netflix has been trying to get ISPs to take their streaming traffic into their networks via Open Connect without paying them?
Edited by michaeltscott - 6/29/13 at 5:50pm
post #1317 of 1798
For anyone interested, click here for a PDF of the latest Netflix filing with the SEC. There may or may not be any info about payments to ISP's for their CDN's. These large corps can have very creative bookkeeping mad.gif At any rate this is about as close to any real info the public will get on this subject. And no, I'm not going to waste my time looking wink.gif
post #1318 of 1798
Quote:
Originally Posted by michaeltscott View Post

Nope--I wrote a long reply yesterday morning which I thought I'd posted but is no where to be seen. It's still in a Notepad buffer on my desktop--I'll review it and post it later.
Your principle conjecture is that Netflix has been asking the ISPs to take traffic via Open Connect into their networks without payment when the CDNs have been paying them to accept Netflix's streams. I don't believe that they ever asked the ISPs to accept that deal and that the ISPs who have not made a deal to "carry" Open Connect have not done so for reasons unrelated to potential loss of that revenue. Now you want to claim that Cablevision was offered the deal and rejected it and that Netflix caved, saying that that was also covered by your theory (a portion of it revealed only yesterday). Since I never believe that Netflix tried to get any ISP to accept a deal which didn't include payment, it fits my theory better.

Sure Netflix would rather not pay the ISPs; everyone would rather get everything for free. I want to buy a new car at dealer cost or below, but I don't walk into a dealership expecting to drive away with one. I don't think that Netflix ever created a business plan around getting Open Connect into ISP networks for free.

Cablevision was Netflix's Open Connect "poster child", a cable MSO with 3.5 million basic subs, the largest US ISP to have accepted the deal at the time of their Super-HD/3D-via-Open-Connect-only announcement. Since then Cox Communications (4.5 M basic subs) has accepted a deal for connection to OC, as has Suddenlink (1.2 M). Combined, along with the sundry small local ISPs, they represent only a fraction of the Netflix customers served by the hold-outs.

Hey people! Chime in--does anyone other than Apostate believe that Netflix has been trying to get ISPs to take their streaming traffic into their networks via Open Connect without paying them?

He's just upset that he has Fios and they don't offer Open Connect. tongue.gif Since Cabevision is currently promoting Open Connect as a value added service that is not available to AT&T and Verizon customers, it may be sometime before Apostate gets to enjoy SuperHD and 3D streaming. biggrin.gif

Quote:
Originally Posted by Wendell R. Breland View Post

For anyone interested, click here for a PDF of the latest Netflix filing with the SEC. There may or may not be any info about payments to ISP's for their CDN's. These large corps can have very creative bookkeeping mad.gif At any rate this is about as close to any real info the public will get on this subject. And no, I'm not going to waste my time looking wink.gif


I'll try to have my wife who is an attorney take a look. It's hard to hide things from her, believe me. biggrin.gif If there is anything worth revealing I'll post it. Thanks.




Ian
Edited by mailiang - 6/29/13 at 4:08pm
post #1319 of 1798
(What I wrote and apparently failed to post yesterday morning):

Apostate, I won't respond to your many slights other than to say that perhaps you should think about how they make you "come off" to others reading this thread. They certainly don't enhance the credibility of your arguments. A "normal adult" doesn't feel the need to punctuate every point-by-point response with an insult; that's what 12 year olds in videogaming site forum "discussions" do. Just to let you know, I'm a 55 y/o software engineer of over 30 years experience in the embedded systems space, the first half in large-scale network equipment R&D, the second in networked office machines and consumer electronics firmware development. So I'm a middle-aged man "who thinks he knows everything" biggrin.gif.

Again, I regret my "talking out of your behind" comment. It was my unfortunate knee-jerk reaction to your, "...Netflix's attempt to get a free ride from ISPs..." remark, something based on nothing except your own conjectures. But that's all that you, I or any of us can do since none of us knows what's actually going down between Netflix and the ISPs. I understand but don't buy the basis for what you guess to be true and you don't buy my reasoning for what I guess to be true. I sense that that's probably not going to change.

I understand that you think that Netflix wants to get Open Connect into the ISPs' networks without paying the ISPs anything. While I'm sure that Netflix would love that, I don't believe that they expect to get that or that they're wasting their time by asking for it.

If Netflix can run Open Connect for what it costs the commercial CDNs to provide them with the same distributed resources then they save the difference between those costs and what they pay the CDNs. One of the components of the CDNs' costs is what they pay to the ISPs. If Netflix pays the same thing to the ISPs they still save whatever amount the CDNs are profiting on what Netflix pays them. To break it down:

C.OprCosts = CDN's total cost of operating resources bought by Netflix
C.ISPCosts = amount paid to ISPs by CDNs
C.TotCosts = C.OprCosts + C.ISPCosts
C.Profit = profits desired by CDN
C.Price = C.TotCosts + C.Profit

N.OprCosts = Netflix's total cost of operating required distributed resources
N.ISPCosts = amount paid to ISPs by Netflix
N.TotCosts = N.OprCosts + N.ISPCosts

N.Savings = C.Price - N.TotCosts

If N.TotCosts = C.TotCosts then N.Savings = C.Profit. The CDNs' net profits on what they sell to Netflix has got to be worth Netflix's effort to save. (I'm no doubt using the term "net profits" improperly; I'm talking about what they charge minus every thing that they spend to deliver their service--equipment, maintenance, facilities, staffing, etc). Obviously Netflix's cost to build out Open Connect has to be recouped before any actual savings is realized, but Open Connect only has to be big enough for the number of subscribers served and can grow as that number grows.

Super HD and 3D video alone aren't ever going to be enough inducement to get Open Connect into the networks of resistant ISPs. Until they tie something to Open Connect which large numbers of network service subscribers will clamor for they have no leverage. Hopefully the larger ISPs will eventually decide that taking a deal to "carry" Open Connect is in their best interests, but even if they don't, Netflix should still save money on serving their customers whose ISPs do have Open Connect access.

As I said before, Super HD isn't necessarily any godsend. Only people viewing screens 65" and larger have expressed any great appreciation for it; the subset of Netflix's customers who view the service on such screens and have the requisite network service bandwidth is probably not huge. I currently watch on a 46" LCD panel (older, CCFL backlit) from 7-9 feet; I can see the difference between the 3850- and 5800 Kbps video, but I'm uncertain whether it's worth the 50% higher bandwidth consumed. I have the 50/5 Mbps Cox service tier with a 400GB monthly cap, so it's bearable, but if I was sharing it with another heavy user or had the 18/2 tier's 250 GB cap I might be a little worried. We are not currently given any way to block Super HD video without also blocking all of the "normal HD" encodes as well.
Edited by michaeltscott - 6/29/13 at 6:00pm
post #1320 of 1798
I have worked for major US ISP's and MSO's in the past, as well as Microsoft and DDOS mitigation companies , and I can say this.. ISP's agree to peer at the major exchanges when they believe that both partners in the peering agreement are more or less equal from a transit standpoint, that is, ISP A is likely to send as much traffic to ISP B, as ISP B is to send to ISP A. The peering relationship then makes sense, since it would not impact revenue (the transit fee revenue loss is offset by the savings of not paying out the same), and it simplified billing relationships.

Netflix isn't a transit carrier, so this arrangement doesn't work. Netflix will send the ISP a TON of traffic, but won't take any in return. Calling this peering is a severe misnomer and likely where all the major ISPs are balking.. There's zero gain for the ISP, and there is revenue loss from not charging transit for Netflix transit.
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