U.S. regulations on internet traffic leaves streaming companies unscathed for now

The meeting room is seen empty following a security threat ahead of the vote on the repeal of so called net neutrality rules at the Federal Communications Commission in Washington, U.S., December 14, 2017. REUTERS/Aaron P. Bernstein

Vastavam web: Behind your video stream of a hit like “Stranger Things” is a complicated array of technology and business relationships that will not change very much, at least in the short term, as a result of this week’s repeal of U.S. regulations on internet traffic, industry insiders say.The U.S. Federal Communications Commission on Thursday repealed its own 2015 rules, known as net neutrality, that required internet service providers like Comcast Corp to treat all online content equally, barring high-speed toll lanes and any preferential treatment of one website over another.

Yet the loud debate has obscured the fact that the biggest streaming companies, including Netflix Inc and Alphabet Inc’s YouTube, already pay internet service providers (ISPs) to deliver their videos, while smaller players mostly do not.The latest net neutrality rules did not erase these business dynamics, people familiar with the arrangements say. The repeal likely will not either, though scuffles could arise as ISPs seek to take advantage of the rule change in the future.

To deliver their services effectively and economically, large video streaming companies spend money sending data directly to different broadband networks, and dominant ISPs at times charge for taking on large volumes of traffic.Big companies like Netflix and Amazon.com Inc also can deliver their video streams far and wide on their own, while many smaller internet companies pay external content delivery networks (CDNs) like Akamai Technologies Inc to do the work for them. Multimedia websites that do not pay for such services are slower in many instances than those that do.

There have been conflicts, notably a 2014 dust-up between Netflix and Comcast, that resulted from the dramatic surge in streaming video traffic in recent years. Netflix ultimately agreed to pay Comcast despite complaining in an online blog post that its partner was “double dipping” by also receiving money from home internet subscribers. Yet this arrangement was not unique.In a statement, Netflix said “tolls decreased for us” after the 2015 net neutrality rules were passed – but did not say they disappeared.The company added: “We support strong net neutrality protections, even if we are at less risk because of our popularity, which keeps our relationships with ISPs stable.”