Netflix pays off Verizon in order to enable faster streaming speeds

By Mike Flacy April 28, 2014

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Detailed by USA Today, Netflix representatives have confirmed that the company struck a pay-for-speed, peering deal with Verizon that’s designed to increase streaming video speeds for both Verizon FIOS and Verizon DSL customers. Providing an extremely brief statement, Netflix spokesman Joris Evers said “We have reached an interconnect arrangement with Verizon that we hope will improve performance for our joint customers over the coming months.” Verizon representatives also confirmed that the deal exists, but declined to comment on the details of the arrangement.

Interestingly, both Verizon FIOS and Verizon DSL speeds have plummeted in the last year. Looking at the Netflix speed charts, Verizon FIOS customers were getting an average of 2.2 Mbps six months ago, but that dropped to 1.8 Mbps in the last three months. Similarly, Verizon DSL customers were getting 1.4 Mbps several months ago, but that’s dropped to less than 1 Mbps in the last three months. At those speeds, customers are likely experiencing longer loading times, quality shifting between standard definition and high definition as well as a general inability to play ‘Super HD’ 1080p or 3D content on the streaming video service.

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Not surprisingly, the average streaming speeds of Netflix on Comcast have absolutely skyrocketed after the two companies struck up a similar peering deal. After hitting an all-time low of 1.5 Mbps during January 2014, the speed index documented a massive 66 percent jump in speed to 2.5 Mbps during March 2014. However, Comcast still lags behind other major companies like Cox and Charter.

While Netflix CEO Reed Hastings has publicly admonished the interconnectivity issues of Internet service providers, it appears as if Netflix still plans to shell out payments in order to improve the experience for customers. The announcement of this deals comes shortly after the FCC launched a new proposal that would allow these type of deals, provided that companies like Verizon could prove that the partnership was “commercially reasonable” according to the FCC’s standards.

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The latest is that folks claiming to have knowledge of the plans told Bloomberg that some content will escape ads, specifically original movies and original children’s content.

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Cut the cord: Quit cable for the best streaming services

The LG G1 Gallery Series OLED TV.

So you want to cut the cord and join the streaming revolution? There are so many on-demand streaming services available now such as Netflix, Hulu, Amazon Prime Video, HBO Max, and Disney+ to name a few. Add to that that the growing selection of live TV streaming services, such as Hulu Plus Live TV, Sling TV, ESPN+, and YouTube TV, as well as live HD broadcasts with an antenna. The whole thing can be rather confusing, especially when you're trying to pick the best streaming services for you. We'll walk you through everything you need to know to finally cut the cord and kick cable to the curb.

Not everyone is cut out to be a cord-cutter, though. Ditching your satellite or cable subscription and the bill it carries sounds great in theory, but it's not something you want to rush into without a bit of research. Let's go through the best methods for dropping traditional cable in favor of some of the best streaming services.
First things first: How's your internet?
The thing about internet-delivered TV is that you need a broadband connection that can keep up with the streaming lifestyle. This may seem like a foregone conclusion, but we want to make it clear that if you're going to bet your precious entertainment future on your home network, you had better have a solid internet connection. Netflix and other similar streaming video services suggest a minimum downstream speed of 5Mbps for HD streaming, but if you have inadequate home internet connection (like 5Mbps) that is not going to allow for a smooth streaming service experience, especially when you consider other devices also using the connection. You will likely experience buffering and possible crashing of the show you are streaming, especially for those with families or households streaming more than one show or movie at a time.
High-quality streaming needs higher-speed internet
Of course, if you're looking to get into the streaming big leagues to access the growing array of 4K Ultra HD streaming content available from Netflix, Amazon, Disney+, YouTube, and others, you'll want to kick up your broadband speed to at least 25Mbps. If you're only going to be downloading 4K content from sites like FandangoNow or Ultraflix -- which offer 4K content at speeds as low as 4Mbps to 10Mbps -- 25Mbps will probably suffice, but regardless of which streaming service you select, fast and reliable internet is key to a positive streaming experience.
Peak internet usage time can affect your streaming
We also recommend testing your internet speed at peak streaming hours (between 6 and 10 p.m. on weekdays) to determine if your neighborhood struggles under the strain of heavy traffic. For example, if you routinely get around 10Mbps downloads during the day, but that speed takes a dive to about 3Mbps around dinner time, you'll want to call your internet provider to see if anything can be done. Fortunately, this is an increasingly rare problem outside of rural areas, but better to check ahead.
Check your home network equipment
Don't forget to check your home network equipment. Most modern routers and modems should offer up all the speed you need, but non-gigabit equipment may not suffice for simultaneous 4K streams. Any hiccups in your experience also may be caused by weird technical issues such as improper port forwarding, wireless interference, or other random things that are tricky to track down, some of which we'll attempt to help you troubleshoot. If you're unsure about any of it, be sure to give your internet service provider a call.