Netflix has seen the speed of video streaming decline significantly over the last few months for many consumers. This decline in streaming speed leads to Netflix users who are unhappy with video quality. Those unhappy customers led Netflix to sign a deal with Comcast that saw it pay for faster streaming to its customers.
Most knew once that first deal was signed, Netflix would be striking similar deals with other providers as they all line up for their cut. A Netflix spokesman recently confirmed that the company had signed a deal with Verizon that will see Netflix pay to speed up streaming for its customers. The interconnection agreement will improve performance for joint customers of Netflix and Verizon over the coming months according to the spokesman.
No details on the financial terms of the deal were offered. The deal was confirmed by Verizon CEO Lowell McAdam at a group investor meeting with no terms noted. Like the Comcast deal, the Netflix/Verizon deal is a paid peering arrangement and doesn't give Netflix any sort of preferred access to the customer home.
What the deal does is allow Netflix to bypass congestion at interconnection points between ISPs and transit providers like Level 3 or Cogent. The next ISP expected to get a paid deal with Netflix is AT&T with customers on that network seeing poor performance for streaming video. Streaming performance for Netflix users increased by 65% after the agreement with Comcast was signed.