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Summary:

Carriers like Verizon and AT&T are trying to convince Netflix to pay for the bandwidth its subscribers consume on their networks. Rather than fork over the money, Netflix is giving its iPhone customers the option of turning off cellular access to Netflix completely.

Netflix iOS app

Carriers like Verizon and AT&T are trying to convince Netflix to pay for the bandwidth its subscribers consume on their networks. Today Netflix delivered a rather oblique response. It’s giving its iPhone customers the option of turning off cellular access to Netflix completely and instead rely on old-fashioned Wi-Fi to deliver their movies and TV shows.

With more and more customers moving off carriers’ old unlimited data plans to tiered data buckets, streaming any reasonable quantity of video is all but impossible without incurring major overage charges. In its latest update to its iPhone and iPad apps, though, customers can toggle on and off 3G/4G connectivity. It may mean sacrificing Netflix access everywhere, but it could help them avoid rather unpleasant phone bills at the end of the month.

There are still a few unlimited options out there for iPhone users. You can stream to your heart’s content on Sprint’s 3G network. There are still millions of customers grandfathered into Verizon and AT&Ts’ old unlimited plans, but both operators have begun throttling back speeds once customers hit unspecified – and seemingly arbitrary – thresholds, making video streaming all but useless.

What’s more, Verizon is doing everything it can to coax, cajole and boot customers off their unlimited plans this summer. Unless the carriers firm up some kind of revenue sharing pact with Netflix – which Verizon may well be in the process of cementing – it looks like streaming movies is going to be primarily a Wi-Fi affair.

  1. Screw the carriers. They all suck. Why the f should they be paid twice for the bandwidth.

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  2. It isn’t like wifi is unlimited either. If it is home broadband, bandwidth caps may be an issue. If it is public, like hotel or cafe, the business that provides it may be under pressure to limit bandwidth too. Carrier public subscriber wifi can be limited at any moment. It only looks like a lot compared to the measly over the air caps cell phone companies give.

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  3. When mobile providers usher in caps similar to current 250 GB home Internet caps, then video on mobile will really grow. But not until then.

    So really this is all a moot point.

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  4. I find it funny that in terms of the Internet, we seem to be moving backwards technology wise. Oh well…

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  5. I think the carriers need to be very careful, what they wish for because by artificially limiting their networks, they are training their customers to use other avenues that can and will become the preferred method over time and eventually, they will become irrelevant.

    Data is the Golden Goose that propels the next generation revenue model, but only if you are an enabler rather than a limiter.

    If they have any doubt, they should ask how landline and long distance businesses are doing today.

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  6. Netflix should look back to its historical strength to find its way forward — free delivery of digital bytes. Netflix got way ahead of competitors by mailing movies on DVDs to its customers, and it had to pay for delivery both directions. If it paid for the bandwidth needed to deliver movies to its customers, its competitors (whether free or paid videos) would be watching Netflix from behind. Box Top has an app called Free Band that sits on end user devices that monitors and meters data usage and allows for content providers (like Netflix) to pay for its customers’ bandwidth consumption. Netflix could undoubtedly cut a good deal with the carriers for bandwidth due to volume, and because FreeBand allows for time shifting of downloads to non-peak hours when the carrier network is largely idle. FreeBand also enables multiple parties to jointly subsidize bandwidth (for example a beer company might underwrite the bandwith for an NFL video download if the customer purchases beer products through the FreeBand app). Check out our website: http://www.boxtop.tv.

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