As President-elect Donald Trump prepares to take the Oval Office, one high-profile tech issue that many analysts are watching is Net neutrality. Republicans are widely expected to seek changes to the rules, which currently bar Internet providers from slowing down websites they don't like or speeding up others in exchange for payment.
But one staunch backer of the rules isn't too worried about the impending rollback, and that's Netflix.
In a shareholder letter Wednesday, the online video giant said it's become so big that any changes to the Net neutrality rules aren't likely to affect its business much at all.
“Weakening of U.S. Net neutrality laws, should that occur, is unlikely to materially affect our domestic margins or service quality because we are now popular enough with consumers to keep our relationships with ISPs stable,” the company wrote.
Those relationships Netflix is referring to are with companies such as Comcast and Verizon, whom you may remember have clashed with the video company over allegations or insinuations that the Internet providers were slowing down Netflix streams. As part of the debate on Net neutrality, Netflix argued that it should not have to pay broadband providers just so it could effectively deliver videos to customers' computers. Ultimately, Netflix signed special, separate contracts with the carriers, the terms of which were undisclosed. When federal regulators later approved the Net neutrality rules, it provided some additional assurance that the government would be there to make sure future deals of that kind would be fair and equitable.
The prospect of a Net neutrality rollback, then, raises questions about how Internet providers may treat Netflix in the future. While it's unclear whether broadband companies would seek to take advantage of that, Netflix's letter seems to anticipate those concerns — both by saying it wouldn't be a big deal, and by signaling to the incoming Trump administration that preserving Net neutrality is still a worthy goal.
“We hope the new U.S. administration and Congress will recognize that keeping the network neutral drives job growth and innovation,” the letter reads.
Even though Netflix says it wouldn't be affected by a weakening of Net neutrality, consumer advocates say that the real point of the policy is to protect those who cannot afford to protect themselves.
“It's understandable that people describe this as Comcast versus Netflix,” said Matt Wood, policy director of the consumer group Free Press. But, he said, “We [are] concerned about the next innovative company that doesn't have the ability to buy itself out of trouble.”
The rules, he added, are also meant to keep consumers in control of where they can and can't go on the Web, rather than leaving it up to big companies.