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Netflix's Comcast deal improves quality of video

By: Associated Press
April 15, 2014 Updated: April 15, 2014 at 1:40 pm
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SAN FRANCISCO - Netflix's videos are streaming through Comcast's Internet service at their highest speeds in 17 months, thanks to a recent deal that bought Netflix a more direct connection to Comcast's network.

Netflix agreed in mid-February to pay an undisclosed sum to Comcast to create a new avenue for its videos to reach Comcast's service. Netflix previously had been paying third-party vendors to deliver its content to Comcast. Some analysts suspect Netflix may be saving money by paying Comcast directly instead of the vendors, but the specifics remain unknown as part of a confidentiality agreement.

The arrangement seems to paying off for Netflix subscribers who are among the nearly 21 million households and businesses that rely on Comcast's high-speed Internet service to watch movies and television shows.

Comcast delivered Netflix video at an average rate of 2.5 megabits per second during March. That was a 66 percent increase from a recent low of 1.51 megabits per second in January.

The March performance also topped the previous monthly high of 2.17 megabits per second that Netflix had recorded on Comcast. Netflix began tracking the streaming speeds of Internet service providers in November 2012.

That's good news for Netflix because higher-quality video should please many of its 33 million U.S. subscribers who pay $8 per month for the company's video streaming service. But that doesn't necessarily mean the Los Gatos, Calif., company is happy.

Netflix CEO Reed Hastings has insisted that his company and other online content providers shouldn't have to pay tolls to Internet service providers, or ISPs, charging their customers $40 to $60 per month.

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