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Verizon Threatens to Sue Netflix Over Streaming Alerts

 & Chloe Albanesius Executive Editor, News

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Verizon has sent Netflix a cease-and-desist letter after the streaming service started displaying warnings that blamed buffering or slowdowns on Verizon's Internet service.

"Netflix's false accusations have the potential to harm the Verizon brand in the marketplace," Randal S. Milch, Verizon's general counsel, wrote in a Thursday letter to Netflix's general counsel, David Hyman.

The note was prompted by a Wednesday article from Quartz, which reported that some Verizon FiOS users, like Vox's Yuri Victor, were seeing warnings from Netflix that said streaming slowdowns were because "The Verizon network is crowded right now."

In the letter, posted online by Re/code, Hyman argued that there is "no basis" for Netflix's assertion that Verizon is responsible for streaming slowdowns.

"As Netflix knows, there are many different factors that can affect traffic on the Internet, including choices by Netflix in how to connect its customers and deliver content to them, interconnection between multiple networks, and consumer in-home issues such as in-home wiring, Wi-Fi, and devices settings and capabilities," Hyman wrote.

Netflix is being deceptive and giving consumers a false impression of how Verizon does business, he continued. "This could cause a customer to think that any attempted viewing of video, whether it be Hulu, YouTube, or other sites, would yield a similarly 'crowded' experience."

As a result, Hyman is demanding that Netflix stop displaying the messages to consumers, and provide the ISP with evidence to support the claim that Verizon's network was crowded when Victor was trying to watch Netflix.

"Failure to provide this information may lead us to pursue legal remedies," he concluded.

Netflix, however, is not backing down. "This is about consumers not getting what they paid for from their broadband provider," a spokesman said via email. "We are trying to provide more transparency, just like we do with the Netflix ISP Speed Index, and Verizon is trying to shut down that discussion."

The spat comes about a month after Netflix and Verizon inked an interconnection (or peering) deal, whereby Netflix pays Verizon for a direct connection to its network to ensure that Verizon users get the fastest possible Netflix experience.

"I sincerely hope this is not a harbinger of things to come in terms of how Netflix treats its network partners and our mutual customers," Hyman said today.

Netflix entered into the Verizon agreement (and a similar deal with Comcast) reluctantly. Netflix chief Reed Hastings recently argued that such deals should not be allowed, and that strong net neutrality rules should ban them. ISPs, however, said Netflix cannot expect them to shoulder the traffic burden by themselves, and that interconnection deals are nothing new.

About Our Expert

Chloe Albanesius

Chloe Albanesius

Executive Editor, News

My Experience

I started out covering tech policy in DC for The National Journal, where my beat included state-level tech news and all the congressional hearings and FCC meetings I could handle. I later covered Wall Street trading tech before switching gears to consumer tech. I now lead PCMag's news coverage.

My Areas of Expertise

Getting my start in DC means I still have a soft spot for tech policy; Congressional hearings can sometimes be as entertaining as a Bravo reality show, for better or worse. But PCMag is all about the technology we use every day, as well as keeping an eye out for the trends that will shape the industry in the years ahead (or flop on arrival). I've covered the rise of social media, the iOS vs. Android wars, the cord-cutting revolution that's now left us with hefty streaming bills, and the effort to stuff artificial intelligence into every product you could imagine. This job has taken me to CES in Vegas (one too many times), IFA in Berlin, and MWC in Barcelona. I also drove a Tesla 1,000 miles out west as part of our Best Mobile Networks project. Of late, my focus is on our hard-working team of reporters at PCMag, guiding and editing their robust coverage.

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