AT&T Plans To Launch Internet Video Service

An anonymous reader writes "AT&T officially announced on Tuesday their intention to launch a Netflix-like service in collaboration with an investment group run by a former Fox president. AT&T is following in the footsteps of Verizon, which partnered with Redbox in 2012 to offer the same type of service, and like Verizon, is also still negotiating with Netflix on payments to not throttle Netflix traffic."

Comments

A corporate tax scam

[bazmail]

Classic tax scam. They can charge their video subsidiary for faster bandwidth, like what happened to Netflix, and write that off against their tax bill. Classic. They are not actually trying to compete with YouTube or Netflix.

Re:A corporate tax scam

[Anonymous Coward]

Then let's pretend that they are going to compete with Netflix, use the death of net neutrality as an excuse to be anti-competitive with them, and block them from shady tax maneuvers and the off chance that they might also try to branch out from the only market they should be allowed to be in: bandwidth provider.

Re:A corporate tax scam

[alen]

they don't need faster bandwidth
just set up a CDN in their network for their customers and the content is there. the issue has always been the internetwork links

even then netflix is like vonage. they are just a middle man and their value seems to be coding a client for every possible device and handling the licensing arrangements

Re:A corporate tax scam

[Anonymous Coward]

you're not hearing what bazmail is saying... setting up a CDN is a real expense with the only goal of improving customer experience, they have no interest in either of those things.... what they want to do is set up a structure where money gets transfered from one pocket to another in such a way as to dissappear from the perspective of the tax man

Ugh

[Anonymous Coward]

Fuck this shit...

Net Neutrality?

[Anonymous Coward]

I have no reason to believe they won't give this full bandwidth while throttling the competition, giving themselves the edge they need to succeed.

Re:Net Neutrality?

[Anonymous Coward]

I have no reason to believe they won't give this full bandwidth while throttling the competition, giving themselves the edge they need to succeed.

The ability to do this is the only reason they are entering the market.

Re:Net Neutrality?

[sandytaru]

Honestly? If it's competitively priced with netflix, I'll pay it, because it means they have to upgrade my lame 1.5 mbps down Internet connection for me to be able to use it!

Re:Net Neutrality?

[Anonymous Coward]

Honestly? If it's competitively priced with netflix, I'll pay it, because it means they have to upgrade my lame 1.5 mbps down Internet connection for me to be able to use it!

Lucky you. I have DSL service (AT&T layer 2, small local ISP layer 3) and I am so far from my local CO and the wiring in my neighborhood so bad I rarely get above 500Kbps. I've always gotten better bandwidth with EVDO on my cellphone. There is this myth that the US does not have a last mile problem. I'd be hapy for responsive SSH sessions. Streaming video is still a pipe dream for me.

Re:Net Neutrality?

[sandytaru]

The QoS on my connection is rock solid, which is why I use the DSL line instead of the local cable guys.

At a previous house, I noticed that our Internet connection would drop whenever a train went down the tracks a mile away. AT&T didn't believe me (nobody did) until I found a painting of the neighborhood from the 1880s that showed that the train terminal used to be at the end of the street. They had literally built the road on top of the old train tracks, and they were still connected to the modern tracks. Since the DSL node was on the edge of the road, it was juuuuuuuuust within reach of the electro-magnetic interference generated by the old tracks. The repair guy was pretty astonished when he bumped into the steel tracks while digging out the line.

The solution, once they finally confirmed that my problem was real, was twice as much insulation around the line. The connection never dropped again after that.

AT&T to Netflix:

[Zalbik]

Hey Netflix, that's some awfully nice bandwidth ya got there....be a shame if anything happened to it....

Re:AT&T to Netflix:

[alen]

well known that netflix used to pay for peering and CDN's until last year when they tried their super HD and open connect and their service went down the toilet

all they have to do is go back to limelight and their service quality will improve

Netflix fucked up when they paid

[Karmashock]

What they should have done is informed their users that their ISP is slowing the traffic that they paid for down intentionally in violation of if not the letter of their contracts then at the very least the common understanding and spirit of the contract.

And if the courts didn't find that behavior to be fraud then the bad marketing and political fallout would do the real work.

By paying, netflix took all the heat off the ISPs and allowed them to get away with it.

Netflix... making bad decisions yet again.

Re:Netflix fucked up when they paid

[Anonymous Coward]

So true.

Re:Netflix fucked up when they paid

[Anonymous Coward]

peering and CDN's have been around since the 90's and are considered best practices today to distribute video content on the internet
netflix has contracted with peering services and CDN's in the past
everyone knows the games cogent and level 3 were playing taking on netflix at cut rate prices and refusing to pay their part of the peering costs

this is why they never sued any ISP, the case would be laughed out of court once discovery was done and all the evidence was presented

Re:Netflix fucked up when they paid

[Karmashock]

Help me understand. You're saying that Netflix is not paying enough for their connection fees?

If so, then it would more reasonable for them to pay that cost up front to their provider rather then pay off every ISP that might receive the content.

Furthermore, I thought they were hosting through Amazon's servers. As such, I would think that the connection fees would be paid by Amazon and then Netflix pays amazon for use of their systems.

No?

that was my understanding of their relationship.

Re:Netflix fucked up when they paid

[Anonymous Coward]

No, it would have not worked. Politica endosrsment is deeply entrenched in U.S. business - politics relations. Kind of like modern fascism. Aka the old "what is good for GM, is good for America!'" Be warned my friends, of false prophets.

Re:Netflix fucked up when they paid

[CastrTroy]

Also, if Amazon is hosting the content, how could they throttle Netflix without throttling the rest of Amazon? Unless they are looking in the packets, they probably can't tell what belongs to Netflix, and what doesn't. So they should just encrypt the data, even with something that isn't resource intensive to prevent the ISPs from peeking at what's in the packets. It doesn't even have to be very secure. Just encrypted/encoded enough to stop the equipment from scanning the packets to find out what's inside.

Re:Netflix fucked up when they paid

[alen]

AWS is only the authentication part. the content is spread around their leased data centers and colo sites

i did some googling and since 2008 netflix used contract with limelight for CDN and lots of third party peering services. as well as transit from cogent and L3. problem is they always cut profit thin deals where the value for the provider was mostly learning to deal with the traffic. even limelight said they made almost no profit on the netflix deal.

instead of paying more in network costs like HBO and everyone else does netflix came out with their own CDN and wanted ISP's to host them for free. unlike the current arrangements where CDN's pay the ISP's for hosting and bandwidth. and netflix started super HD right at the time they screwed up their distribution system and went on their PR parade saying how bad all these ISP's are.

i don't know what the deal with AT&T and Verizon is but with comcast the difference is netflix is paying comcast directly instead of the other services they used to
pay. win/win for everyone and cutting out the middlemen

and if you look at netflix's financials their tech costs are less than 1/10 of revenues and content costs are 3/4 of revenues. their problem is they are just a low margin middle man for content and make very little profit

Re:Netflix fucked up when they paid

[Karmashock]

So again, they're not paying proper freight for their hosting services?

Re:Netflix fucked up when they paid

[alen]

if you google "netflix data centers" and read all the industry info, no
they always found vendors with cut rate deals
everyone does streaming now and the quality is almost always better than netflix. why is that?

i've streamed from Vudu, itunes, HBO, amazon, PBS, smithsonian, red bull and lots of other services outside my pay TV package and the quality is better than netflix. yet people think there is some conspiracy against netflix. i'll rent a movie 2-3 times a month on itunes and it never buffers on my 15/1 connection to my apple TV. same with vudu to my xbox one

Re:Netflix fucked up when they paid

[Anonymous Coward]

They obviously did the math and decided that[at least in the short term] it was better for them.

Netflix is a for profit corporation fighting to protect its own capital and bottom line. Don't fool yourself into believing any different because you happen to have a common enemy.

Re:Netflix fucked up when they paid

[Anonymous Coward]

I get 150MBPS and regardless of what Netflix pays I expect my 15,000kbps no more no less especially from servers that can push data like Netflix.

Re:Netflix fucked up when they paid

[thaylin]

Because almost all of the ones you mentioned already have deals with the ISPs?

Re:Netflix fucked up when they paid

[QuantumRiff]

When cable providers and stations have a spat, its common to see a runner of "this station might be affected by X.. call them at ###-###-#### and tell them you want to keep this channel

They really annoy me, but it might be very, very effective for netflix to give users notice that its their ISP's uplink that is not sufficient.

Re:Netflix fucked up when they paid

[alen]

netflix did too until they demanded free network access to every ISP

Re:Netflix fucked up when they paid

[Karmashock]

yep, that's mostly where I am with the issue.

Let comcast answer to their customers. And then when comcast stone walls them, let them answer to congressmen wondering why we tolerate these semi state sponsored monopolies.

Re:Netflix fucked up when they paid

[Karmashock]

Its hard to understand why comcast isn't double dipping here. They were paid already for that bandwidth by the consumers.

Why does it matter where it came from? Imagine if all those people were doing a million different things such that they couldn't categorize behavior and throttle traffic... what then?

I don't know... we may need net neutrality legislation if this isn't resolved.

Re:Netflix fucked up when they paid

[Karmashock]

they also are known to make poor choices in regards to their business or do you not remember the unbundling of their digital and mail service that had their customers revolting?

Netflix makes bad choices in these areas. They don't understand that they're being watched by the users.

Great!

[Anonymous Coward]

I look forward to never paying for it!

SeT SAIL 4 FAiL!

[Anonymous Coward]

Hooray! Market fragmentation never mind... Carry on, no price increase per user per month to see!

Fix Uverse First

[Anonymous Coward]

In nearly four years, AT&T hasn't managed to pull off a credible streaming app for Uverse.

Epic fail.

Now they want to try to develop a Netflix service? Good luck with that AT&T.

Data cap

[wjcofkc]

If they want this service to reach full potential, they are going to have to lift their 120 gigabyte per month data cap for their DSL customers. My girlfriend and I routinely go over that data cap with the likes of Netflix and Hulu, etc... Unfortunately, Time Warner is slow, routinely goes down, and is still more expensive than paying the penalty.

I realize the data cap has other services in mind, but if they are going to show up on my Roku, they need to understand that they are joining an ecosystem.

Re:Data cap

[TheRealMindChild]

They won't raise the cap. Using their service just won't count against your cap

Re:Data cap

[Anonymous Coward]

They won't raise the cap. Using their service just won't count against your cap

That would open the door to discrimination claims. Instead they will bundle a "free" gig with every rental. Most people are not going to understand why that is as bad.

Re:Data cap

[Darinbob]

It's 150GB for DSL, 250GB for U-verse. However from what I can see they are not actually enforcing this. Their metering web site never works and always says try back later. If they really are charging you for going over the cap, then I suspect they're only enforcing for non-uverse customers. For uverse they are supposed to not count television usage as part of the cap, even though it's coming over the same network, so presumably they would do something similar for their own service?

The Free Markets

[Anonymous Coward]

You see competition will do its job, help the consumer, and lower prices while giving us more bandwidth and better service.

....

Ahahahahahahahahaaahahahahaha! God! I kill me!

I should do stand up!

How will it be competitive?

[swb]

Amazon Prime and Netflix both have largely overlapping and largely low-quality streaming video choices. Most explanation say that it's due to licensing choices (new releases, HBO, etc) or complexities (old TV) by Hollywood rights holders.

But, Amazon and Netflix bring other value to the table -- Amazon prime provides cheaper package delivery, Netflix can get you most anything you want to watch in the mail on a DVD. Apple has value through its large installed base of hardware and its pretty early engagement in digital distribution. Both Amazon and Netflix are now into producing desirable content they own outright.

How will an AT&T streaming solution be competitive without obviously anti-competitive behavior (eg, cripple Netflix and Amazon streams)? It doesn't seem like Hollywood will suddenly have a change of heart on licensing arrangements, although I'm pretty sure they will ink the same basic licensing deals for the same content Netflix and Amazon have for whatever upfront money it takes to enter into the licensing deals.

So there's no content advantage to AT&T at all. No device tie-in, no extra content. What's the point? It sounds like 100% MBA nonsense.

Probably have ads every 3 minutes

[gelfling]

For AT&T products and services. They are the Devil.

Hope it works better than AT&T "U-verse"

[concealment]

Their internet service is excruciatingly slow. That, and the electronics boxes they put at the end of each block keep exploding. Maybe their video service will work better, but I am skeptical. Not too much that AT&T has done at the consumer level has worked out too well.

Recruiter asked me about a job for this today.

[Anonymous Coward]

A tech recruiter pinged me on a job to help with working on this project today, so yes its legit, or at least legit enough that they are now trying to hire the same people that netflix has tried to hire. I turned down netflix due to location issues; I didnt want to leave Seattle. But ATT is hiring people form the Seattle area so it may happen.

At this rate soon the going rate for a good actor

[ralphaostrander]

Is going to be 10 bucks an hour. Kind of like how the ads use to say and Windows NT 100.00 per hour. Then everyone and his brother got a computer.