On the heels of Comcast’s
deal with Netflix to provide faster and more reliable Internet service, now comes word that AT&T and Verizon are also working on similar TV-video deals.
AT&T issued a statement that
it was in talks with Netflix, while Verizon CEO Lowell McAdam said on CNBC on Monday that the two companies have been in negotiations for a year.
The effort by Netflix is intended to bypass
middleman companies that provide broadband connection and traffic with a direct connection with Comcast. For some time, Netflix consumers have been complaining about slow connections in accessing
The costs will initially be minimal to Netflix, according to analysts -- around $25 million to $40 million a year. But the structure of the deal could mean escalating fees
to Comcast, which could grow to several hundred million dollars.
Analysts are worried that eventually Netflix consumers might be footing the bill for these quicker speeds -- as well as to
other TV-video content producers making similar deals.
Netflix has had a streaming service called Open Connect for TV providers’ direct access, but AT&T, Verizon, Time Warner
Cable, and others do not use it.