Verizon: We Can Basically Charge Netflix For Peering Forever And There’s Nothing The FCC Can Do To Stop It

The FCC is facing a lot of opposition this year, but Verizon in particular just really seems to thrive on challenging the agency. The latest move from the telco giant is a message to the FCC that even if they use Title II to regulate net neutrality, there is nothing the commission can do to prevent interconnection fee spats like the one Verizon and Netflix had this year.

Ars Technica noticed the filing (PDF), which Verizon submitted yesterday. The eight-page letter lays out Verizon’s familiar argument that the FCC can’t legally regulate Verizon’s broadband business under Title II but adds that even if they could, it wouldn’t help anyway.

Verizon and Netflix have had a particularly contentious relationship this year. Even after the two companies signed an interconnection agreement, it took months for FiOS customers to see any improvement in their (terrible) service, and the two companies engaged in very public finger-pointing over the matter.

That public spat continues in Verizon’s filing. Verizon writes that, “Internet players such as Netflix and Cogent have called for the Commission to reach beyond the last mile and regulate interconnection … But Netflix, Cogent, and numerous other Internet players make decisions on their own networks that affect the speeds or performance that end users experience.”

Verizon continues, “Any argument to regulate interconnection arrangements therefore would apply equally to those arrangements, but Netflix and Cogent presumably would object to doing so because those decisions — like Internet interconnection — raise issues that are distinct from the delivery of traffic in the last mile. By conflating last-mile regulation with interconnection issues,” Verizon concludes, “these entities are baldly pursuing regulatory rents that would reduce the costs of their business models by shifting them onto broadband subscribers.”

Netflix CEO Reed Hastings has previously poked fun at the idea that ISPs deserve to be paid extra for delivering Netflix service to subscribers who request it.

The FCC announced in June that it would start gathering data on the peering agreements Netflix has made with Comcast, Verizon, and others in the past year. They have not yet announced any intention to change regulations around interconnection agreements, but the topic has repeatedly come up in discussions around net neutrality. The two differ because net neutrality has to do with how data is treated once it is on an ISP’s network, but peering happens one step farther up the chain, and has to do with how that data gets on to the ISP’s network to begin with.

As Ars explains, even using Title II regulation would not mandate that companies (like Netflix) be able to get the no-cost interconnection agreements they hope for. However, designating broadband ISPs as common carriers could give the FCC authority to insist on reasonable rates and to intervene in disputes between ISPs and content companies.

Verizon to FCC: You can’t stop Netflix-like interconnection payments [Ars Technica]