Netflix Supplier Complains About Comcast Fees

Level 3 Communications, a major supplier for Netflix, says Comcast has begun charging an extra fee anytime one of its customers orders a movie for online streaming.

Net neutrality proponents say it's a perfect illustration of what Net neutrality is all about.

Netflix supplies movie and other video content to millions of customers. Until recently customers received the content on DVDs through the U.S. Mail. But the company has encouraged subscribers with broadband Internet connections to download their movies instead.

Not only does the customer get the movie instantly, there are no postage and handling costs. Netflix recently rolled out a new download-only service at a reduced price.

Level 3 is one of the companies Netflix uses to actually provide the streaming technology. Now, all of a sudden, Level 3 says Comcast is taking on an extra fee anytime one of its subscribers downloads a Netflix movie.

While Level 3 is crying foul, Comcast - and other major network operators - have pointed out that content that uses huge chunks of bandwidth should be subjected to a different rate structure.

But under Net neutrality, that couldn't happen. If a policy of Net neutrality were in force, Comcast and other networks could not discriminate against different kinds of content, treating an email the same as a video.

"This action by Comcast threatens the open Internet and is a clear abuse of the dominant control that Comcast exerts in broadband access," said Thomas Stortz, Level 3's chief legal officer.. "With this action, Comcast is preventing competing content from ever being delivered to Comcast's subscribers at all, unless Comcast's unilaterally determined toll is paid."

Level 3 said it intends to register its complaint with the Federal Communications Commission, which reportedly plans to consider implementing a Net neutrality policy when it meets in mid-December.