Level 3 Communications: 'Why doesn't Comcast accept our offer?'

Comcast, the United States' largest cable provider, and content delivery network Level 3 Communications remain at odds over how they will work together in the future. A major issue arose between the two companies in late November, after Netflix announced Level 3 would be its primary CDN, and Comcast sought to collect new fees from Level 3 due to the massive increase in traffic the Netflix arrangement would cause.

Level 3 argued that Comcast was abusing its monopolistic position to squeeze money out of a service working "over the top" of its broadband connections. Comcast, on the other hand, said it's simply re-negotiating a "peering" (free traffic) arrangement to a "transiting" (paid traffic by volume) arrangement.

Last Week, AT&T joined in the argument, and accused Level 3 of trying to create controversy by throwing around terms like "net neutrality" and "monopoly" when the issue was about peer versus transit.

"Earlier this month Level 3 won some of NetFlix's streaming business which may have something to do with the growing traffic imbalance," Bob Quinn wrote in AT&T's Public Policy Blog. "I am confident that the CDN providers Level 3 'won' this business from had been paying Comcast to deliver this same content to Comcast's customers."

Level 3 says AT&T has missed the point completely.

"Those who keep trying, deliberately or inadvertently, to maintain that the Level 3 and Comcast disagreement is 'just a peering dispute' rather than a blatant attempt by Comcast to leverage a dominant position in the residential Internet access market are missing the point, no matter how loudly and how often they try to distract from this central issue," A statement from Level 3 said this week.

"A peering dispute is clearly not the issue, rather, Level 3 and many experts and industry commentators believe that Comcast wants to set a precedent allowing them to charge a 'toll' for capacity added to their 'last mile' cable Internet access network," Level 3 argues. "This is the heart of the matter since Comcast is seeking to leverage exclusive access to its local Internet access customers. If this is not true, why doesn't Comcast simply accept our offer to deliver traffic to the edge of its big cable markets?"