Comcast now has a ‘toll booth’ fee for online video

For those that don’t think we need net neutrality, here is another shining example of how not having it will hurt consumers. Level 3 today raised alarms with claims that Comcast was engaging in anti-competitive behavior with a new charge for online video. The Internet backbone provider said that Comcast had suddenly started charging extra for video to its customers and threatened to block video traffic from Level 3, which supplies streams for Netflix and other major providers. It agreed to pay the fee to avoid a disruption but accused Comcast of setting up a “toll booth” deliberately designed to prevent competition with both cable TV and its own Internet features.

The fee lets Comcast “unilaterally decide how much to charge for content which competes with its own cable TV and Xfinity delivered content,” Level 3 said. “This action by Comcast threatens the open Internet and is a clear abuse of the dominant control that Comcast exerts in broadband access markets as the nation’s largest cable provider.”

It further argued that Comcast would likely run into trouble with the FCC, since the video-specific fee directly violated proposed net neutrality rules and contradicted Comcast’s assertions that it valued an open Internet. The approach showed the risks of a closed Internet often sought after by carriers, Level 3 said, since it would effectively let a provider like Comcast dictate what customers would be allowed to see.

It’s obvious that Comcast is doing this to try to get more subscribers to their service when more and more people are cutting the cable cord. This price increase will, no doubt, be passed onto the consumer as well.

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