Netflix, Inc. (NASDAQ:NFLX) is cheering for while companies like Comcast Corporation (NASDAQ:CMCSA) reeling from the stand President Barack Obama outlined in a recently-released statement about Net Neutrality, Hans Nichols said in a recent report for Bloomberg’s On The Move.
The comment about the Net Neutrality rules laid down by Obama which affect on one side Netflix, Inc. (NASDAQ:NFLX) and others which stream content to U.S. homes via the internet, and on the other side Comcast Corporation (NASDAQ:CMCSA) and companies whose networks are used to pipe the contents to homes, was made by Nicholson after the current U.S. administration discouraged the Federal Communications Commission to let internet service providers charge other companies for better delivery of their content.
“What the U.S. administration is strongly urging the U.S. Federal Communications Commission to do is not to have slow lanes and not to have fast lanes. This means that the ISPs, the cable companies, the phone companies [and] the companies that lay the last mile of line into your home, they can’t then turn around and charge the Netflix of the world a higher rate so that they can deliver that content maybe a little bit faster,” Nichols said.
Netflix, Inc. (NASDAQ:NFLX) has been very vocal about its support for Net Neutrality, a movement that advocates that all traffic should be equal on every internet service provider’s networks.
For example, Netflix, Inc. (NASDAQ:NFLX) has been butting heads with Verizon Communications Inc. (NYSE:VZ) over what it alleges as throttling of its content to Verizon subscribers. The company was also reported to be against paying companies like Verizon and Comcast Corporation (NASDAQ:CMCSA) for these internet companies to prioritize the delivery of their content.
On the other hand, Comcast Corporation (NASDAQ:CMCSA) and others have argued that streaming services should at least share the burden of delivering the content to customers as streaming services take too much of the available bandwidth of networks and therefore put strain on the system and affects other customers who are not streaming content.
Comcast, headed by Brian Roberts, one of the highest-paid CEOs in America for the year, has also seen protest from Netflix about a merger with Time Warner Cable Inc (NYSE:TWC).
“So the Netflix of the world are cheering this. The content providers, in general, [and] Internet advocates are saying this is a great deal. Here’s who’s saying this is not a great deal: Republicans and the cable companies,” said Nichols.
He noted that there will likely be legal challenges to the statement of President Obama.
Netflix, Inc. (NASDAQ:NFLX) shareholders includes Andreas Halvorsen’s Viking Global which reported owning about 1.32 million shares in the company by the end of the second quarter of the year. Comcast Corporation (NASDAQ:CMCSA) shareholders includes John Armitage’s Egerton Capital Limited which reported owning about 12.38 million shares in the company in the same period.
