Netflix and AT&T strike interconnection peering agreement

30 July 2014 | Kavit Majithia


Netflix will pay US telco AT&T for the smooth delivery of its content after signing a peering agreement, both companies announced yesterday.

Netflix has been campaigning against the fees, claiming that it goes against the principle of the open internet, ever since US regulators FCC said it would review the present state of the market.

The peering interconnection agreement between the companies, originally struck in May, could be extended and lead to the build out of a new network connection for Netflix content to be delivered directly to AT&T servers.

Netflix has already struck similar deals with both Comcast and Verizon, with the ISPs claiming that these type of deals are not going against the principle of net neutrality because it does not affect how content moves across the network.

A peering interconnection agreement only focusses on how the content gets onto a network and Netflix is now paying the ISPs for direct access to its network, ensuring that large quantities of data are getting to its customers without delay.

Both sides have accused each other of slowing down speeds on the internet by the way traffic is routed, and the ISPs are claiming they need to be paid fees to accommodate the high influx of data and upgrade their networks.

Netflix has hit out at having to sign interconnection agreements and has urged the FCC to extend net neutrality laws to barring such agreements, claiming the ISPs are gaining too much power over how they regulate traffic.

The financial terms of the agreement between Netflix and AT&T remain undisclosed.