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Netflix: Apple TV outpacing iPad, net neutrality at risk

updated 06:05 pm EST, Wed January 26, 2011

Netflix says Apple TV trumps iPad, OKs FCC moves

Netflix while discussing breakthrough results on Wednesday surprised the industry with word that the new Apple TV was already more popular than the iPad for Netflix movie viewing. Apple's media hub had already accumulated more viewing hours in its first four months than the iPad managed in nine. The movie rental service didn't try to explain the gap, but it suggested many still preferred to use Netflix's movie streaming on a TV despite the surge in tablet video.

Game consoles like the Xbox 360, PS3 and Wii were also very popular. Both the regular iPhone app and the Windows Phone 7 app were similarly "popular," as were Roku's Internet Player media hubs. The company hinted that Google TV was a disappointment as it had "not yet gone mainstream." It was still confident the Android-based TV platform would eventually be "very successful" and was still investing in Google's devices.

Along with the device mix, Netflix outlined explicit support for the FCC's net neutrality order and promised a direct attack on opponents. It planned a list on its blog for Thursday that woud name and shame Internet providers that were providing a poor experience or which it suspected were deliberately obstructing its service. The movie outlet dropped direct hints that it would single out Comcast for its raising Level 3's costs. Providers like these were double dipping by trying to charge L3 not only for basic traffic but also for as a content provider, effectively serving as a way to 'punish' Netflix for competing with Comcast's own services.

"As long as we pay for getting the bits to the regional interchanges of the ISP's choosing, we don't think they should be able to use their exclusive control of their residential customers to force us to pay them to let in the data their customers' desire," Netflix said. "Their customers already pay them to deliver the bits on their network, and requiring us to pay even though we deliver the bits to their network is an inappropriate reflection of their last mile exclusive control of their residential customers."

It instead argued for an "open, regional, no-charges" model where both Netflix and an Internet provider didn't apply extra costs just for video deals.

The message also warned of carriers trying to exert a per-gigabyte, usage-based model, such as what has been threatened by Canadian providers like Bell, and of providers that instituted deliberately low bandwidth caps. It rejected attempts to exaggerate the costs for Internet providers to supply video and noted that the actual cost didn't justify any change in model.

"To deliver a marginal gigabyte, which is about an hour of viewing, from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary," it said. "Moreover, at $1 per gigabyte over wired networks, it would be grossly overpriced."

The carrier is also likely to single out Time Warner, which MetroPCS' net neutrality violations as the phone carrier has blocked Netflix on its cheaper 4G data plan.



By Electronista Staff
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Comments

  1. pairof9s

    Mac Enthusiast

    Joined: Jan 2008

    +6

    I'd agree

    I'd say that I still prefer watching movies, including those streamed from the likes of Netflix, on my TV. It's just a matter of liking the "big picture" ambience of large screens versus a 10" screen in your hand or on a stand.

    /

  1. starwarrior

    Fresh-Faced Recruit

    Joined: Mar 2006

    +1

    Apple TV Very Nice

    But:

    New Internet enabled TVs such a those of Vizio seem to have access to more content. Are the Cable Companies, TV Manufactures and Media Moguls trying to short circuit the hobby. They are doing it at a premium price as these TV Internet machines cost over $500 more for the features that Apple gives for $100. Is the $500 paying for the extra content?

    Time will tell.

  1. Mr. Strat

    Junior Member

    Joined: Jan 2002

    +5

    I like Apple TV

    I recently got a flat screen for my second residence along with an Apple TV.

    We love the Apple TV. Netflix needs to get more current content as many new movies are only available on disc. But I realize that this is largely the fault of the copyright owners who prefer a pay-per-view model. But still, there is a lot available, it's easy to operate, and looks great on the screen.

  1. chas_m

    Moderator

    Joined: Aug 2001

    +3

    Not surprised

    Apple TV + Netflix = really pretty awesome, and can allow many people to "cut the cord" (or at least the TV half of the cord).

    GoogleTV has no content and no appeal. I'm not dissing them, though -- AppleTV needed THREE full tries with Apple TV before they hit the right combination that clicked with the public. GoogleTV will too -- at least.

  1. byRyan

    Fresh-Faced Recruit

    Joined: Jun 2007

    0

    comment title

    I was watching a movie with my girlfriend last week on netflx and she said she preferred watching the movie on the pad rather then the TV because the iPad had a more 'intimate' feel - both of us snuggled up around a small screen.

    but that aside - the ipad is inconvenient for watching long format TV and requires you to hold the thing - so I'm not surprised watching on the big screen is more popular.

    I think its time though that the cable companies adapt to the changing times rather then fight it. I recently returned my settop boxes and am saving about $80 per month. If their rates were more reasonable, I think they would see a tremendous surge in their business, but people are wising up to them. It is way more convenient to me to watch something on TV and record it to my DVR then it is to watch it on hulu, but when they charge me $8 per moth for the DVR, $10 per month for the DVR service, $5 per month for advanced TV, $20 for basic cable, $30 for extended cable, I think to myself - I could just buy those episodes off of iTunes for cheaper.

    I pay right now $50 per month for internet, and essentially get free basic cable because of it. If I had to pay an extra $10 or even $20 a month to get a DVR with that to bring my bill to $70 I would gladly pay it. But instead they get greedy and charge me $70 additionally with all their fees to bring the total to $120. Simply put - they are driving their customers away by overcharging everyone. If they lowered prices, people would stay. As it is - their business model needs to adapt because in the near future - all cable companies will be is internet service providers and nothing more - so its not wise to piss off your customers by restricting their access!!

  1. testudo

    Forum Regular

    Joined: Aug 2001

    -1

    @byRyan

    Simply put - they are driving their customers away by overcharging everyone. If they lowered prices, people would stay.

    Except it isn't the cable company setting the prices. A lot of that $80 goes off to the cable networks. For example, the NFL Network pressured several cable providers to put their network on extended basic cable. The cable companies wanted it on one of their premium sports tiers, but the NFL network refused, because they want to get it in as many homes as possible. And they want a good 75 cents or so, if not more, per household. Putting it on the 'basic' plan means everyone pays, and they get more cash. So everyone gets to pay!

    Add in the popular networks (like TNT, USA, FX, ESPN) get to not only charge a pretty penny ($4 for ESPN alone), but get to push their other, less popular networks, in package deals. ABC can tell Comcast "Hey, you scum, if you want ESPN, you need to carry ABCFamily and ABCNews". Which they also get paid for.

    Which is why the call for 'al a carte' pricing is hillarious. The only reason the prices of individual channels is so low is because they get paid per household. If the FCC mandated that you could get just the channels you want, some of those channels would increase a lot in price, basically driving them off the air.

    As it is - their business model needs to adapt because in the near future - all cable companies will be is internet service providers and nothing more - so its not wise to piss off your customers by restricting their access!!

    What's going to happen in such adaptation is that internet rates will rise. As more subscribers leave the TV planet and just go 'on-line', they're making less money from the tv side to cover their infrastructure costs. The only way they're going to get that back is to raise prices. Or start doing more tiers and caps.

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