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Verizon CEO: We're working on a funding deal with Netflix too

updated 05:28 pm EST, Mon February 24, 2014

CEO calls deals necessary for survival of streaming services like Netflix

In an interview with CNBC, Verizon CEO Lowell McAdam noted that he was fairly certain that he would strike a similar deal as Comcast's with Netflix, making the streaming video purveyor pay for bandwidth, at least in part. McAdam called the Netflix deal with Comcast a "good thing," which allows for funding necessary infrastructure maintenance and build-outs.

"It's not a surprise that Netflix has been talking to everybody, and we've been talking to them for about a year," said the CEO, adding that "I'm not here to pre-announce and I'm not here to change my hand at the negotiating table, but I think there's a good opportunity here." Referring to the Netflix CEO Reed Hastings, McAdam said that "both Reed and I have talked about it, and we think it's in both of our interests."

Netflix struck the deal with Comcast to protect user speeds, which had been plummeting in recent months. Verizon is seeing the same drop, with Verizon being accused of blocking the streamer, and not upgrading necessary equipment to help Netflix's speeds.

McAdam stated that "if you see someone come in with a lot of load on the Internet, the video, you've got to get that in an efficient place. Making the connections far out in the network is a good thing and frankly paying for it, the commercial model, I think will work pretty well. To me that shows that you don't necessarily need a lot of regulation in a dynamic market here. By doing these commercial deals, we'll get good investments and good returns for both parties."

by MacNN Staff



  1. cashxx

    Junior Member

    Joined: 04-13-09

    I think it should be illegal for this to happen! They already pay a fee and so does the customers. Now they are charging more on top of what you already pay! Its the providers problem to keep the equipment going and bandwidth and add more, etc. Not by throttling what you paid for already, they need to expand and keep it going for what you paid for. Not shake down netflix for more money to pay for your services!

  1. prl99

    Mac Enthusiast

    Joined: 03-24-09

    Comcast has plenty of money but what they're charging Netflix will be passed on to the consumer. We already pay way too much and now we'll pay even more. Verizon left my area, dumping their garbage DSL (no FIOS around here) onto Frontier. I can't go to Frontier because their system is very slow and sooner or later they will start charging Netflix and then all ISPs will try and charge Apple and the other streaming systems. Even with all the money Comcast will collect, their service and delivery speed won't get any better because all the extra money will go into the pockets of their management and investors.

  1. auto_immune

    Dedicated MacNNer

    Joined: 05-29-08

    wrong thread

  1. YangZone

    Fresh-Faced Recruit

    Joined: 05-24-00

    Times are hard... actually 'am thinking of heading over to Netflix see if they might want to contribute to my rent... . I'm a good customer... 'worth a try.

  1. bdmarsh

    Junior Member

    Joined: 02-17-06

    "this time around the company earned $7.9 billion on $31 billion in revenue. The wireless division of the company accounted for $21.1 billion in revenue." - from Jan 2014 report on Verizon's year end financials.
    (their year-ago-report was a loss of 4 billion- attributed to damage from a hurricane.)
    seems like they do have money...
    if they really do want to go down this road can consumers start billing the ISPs for infrastructure they have to build within their house to support all of their computers & devices?

  1. coffeetime

    Senior User

    Joined: 11-15-06

    Fast forward into the future, I am buying a house that has furnace, public water, electricity, and built-in ISP. My house is my homepage.

  1. driven

    Addicted to MacNN

    Joined: 05-08-01

    Honestly, who didn't see this coming when the courts struck down the FCCs net neutrality rule?

    What really needs to happen is Congress needs to reclassify cable (and other) providers as a common carrier. That will let the FCC re-apply the rule. Since both major parties claim to support the concept of net neutrality this could be one of those rare bi-partisan moments.

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