As soon as Comcast announced their intent to acquire Time Warner Cable, opinions started flying around faster than Netflix‘s reported loss of customers. The premium on-demand internet streaming service is citing frustrated users who are canceling their subscriptions in its new argument against the merger, summarized in a hand-delivered document to the Federal Communications Commission earlier this week.
According to Quartz, Netflix’s lawyers urged the FCC to put a stop to the acquisition in a (albeit redacted) 256-page document: “The proposed merger puts at risk the end-to-end principle that has characterized the internet and been a key driver in the creation of the most important communication platform in history.”
Previously, Netflix’s vice president of content delivery, Ken Florance, made statements on Netflix’s blog claiming the company noticed an extreme decline in video streaming quality among its customers using the Comcast network. He said Netflix was forced to pay Comcast for access to its subscribers, allowing the network to essentially “double-dip” by taking money from both Netflix and from the customers paying for Comcast’s connection to access Netflix. A chart clearly shows improved connection for Netflix streaming as soon as the deal was sealed.
But now, Florance is taking things a step further by claiming Netflix wasn’t just forced to sign a deal with Comcast because video streaming quality was poor, but also because the online video distributor was losing customers. In the document to the FCC, Florance states, “For many [Comcast] subscribers, the bitrate was so poor that Netflix’s streaming video service became unusable… Those customers complained to Netflix and some of them canceled their Netflix subscription on the spot, citing the unacceptable quality of Netflix’s video streams and Netflix’s inability to do anything to change the situation.”
Florance didn’t include any charts this time, but he’s implying the massive amounts of power Comcast would gain in the merger would ultimately harm consumers and the internet as a whole. Considering Netflix is also currently paying Time Warner, Verizon, and AT&T for better streaming capabilities, it’s little surprise the company’s worried. In his earlier blog post, Florance stated, “There cannot be an ‘intensely competitive’ market when Comcast alone sets the terms and conditions for access to Comcast subscribers.”
Comcast insists the acquisition has nothing to do with net neutrality, and argues the proposed merger would actually spread Comcast’s support of net neutrality to Time Warner customers. And while the network has previously argued against the claim that Netflix’s customers were experiencing poor streaming quality, it hasn’t yet answered to this new angle regarding Netflix’s customer loss.