Feb 24 Verizon Communications' chief
executive said on Monday he expects Netflix will pay
the telecom company for faster speeds after Netflix customers
complained about slow connections to stream TV shows and movies
with Verizon's FiOS service.
This sets up the possibility that Netflix will have to pay
another big broadband provider for a faster connection after
striking a similar deal with Comcast Corp on Sunday.
Verizon CEO Lowell McAdam said on CNBC, where he discussed
Verizon's talks with Netflix, that the two companies have been
in negotiations for a year.
The deal hinges on whether Netflix can set up direct access
to Verizon, known as an "interconnect agreement", rather than go
through a third party.
Netflix's willingness to pay for faster speeds throws into
question whether more media companies will have to follow suit.
Verizon provides millions of U.S. customers with its FiOS
broadband service and Netflix speeds have slowed on that network
in recent months, leading to complaints.
Federal regulators are wrestling with the issue known as
"net neutrality" that concerns broadband providers and whether
they can make content companies pay for faster service.
"It shows you don't necessarily need a lot of regulation in
a dynamic market here. Doing these commercial deals will get
good investment and good returns for both parties," McAdam said.