Interconnection agreements do not deal with how content moves across the network of an ISP, but instead focus on how it gets onto the network. In short, Netflix customers — who are also the customers of ISPs — request large quantities of data from the video-streaming company. Non-paid interconnect agreements see traffic traded between networks for no cost. ISPs are unhappy that Netflix sends so much data onto their networks, allowing the connection points between themselves and the video service to become clogged.
Netflix, therefore, pays the ISP for a direct connection to its network, ensuring that its content can find its way to its customers without delay.
While Netflix is willing to sign peering agreements with ISPs, it doesn’t want to. The company has taken a hard line in favor of what it calls strong net neutrality, a definition that it expands to include the barring of peering agreements.
Netflix provided TechCrunch with a brief statement on the deal, indicating that the agreement was reached in May, and that it would see “additional interconnect capacity” installed to “improve the viewing experience of our mutual subscribers.” The processing of hooking up the new capacity should be “complete in the coming days.”
This is the new normal.