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Feb. 28, 2014, 10 a.m.

This Week in Review: Making sense of the Comcast/Netflix deal, and an FCC study takes heat

Plus: Piers Morgan hits the exits, options to break up the NSA, and the rest of the week’s news in journalism and tech.

The Comcast/Netflix deal explained: Two weeks after Comcast announced it would buy Time Warner Cable and a month after a federal court overruled the U.S.’ net neutrality regulations, Comcast signed an agreement with Netflix in which Netflix will pay Comcast for a direct traffic-sharing connection to its network in order to improve the quality of its streaming video. The deal, called “paid peering” or “transit,” is likely to be the first of several for Netflix, as Verizon and AT&T both quickly said they’re negotiating similar arrangements with Netflix as well.

The Lab’s Ken Doctor looked at the business end of the deal: Netflix is clearing hurdles to its video streaming quality as it prepares to introduce additional tiered pricing, and Comcast is removing Netflix as a possible objector to regulatory approval of its purchase of Time Warner Cable. Variety’s Todd Spangler said Netflix has now fixed some of its key costs and is solving its biggest streaming quality problems, though Peter Cohan of Forbes said the deal doesn’t tell us much about how Comcast will treat other video-streaming services, especially after its Time Warner merger. If you want the really deep dive on the agreement, read Dan Rayburn’s post with the details.

It’s important to note that this deal would not have been covered by net neutrality regulations. As CNET’s Marguerite Reardon and Consumerist’s Chris Moran explained well, peering isn’t about stopping intentional slowdowns of traffic quality or about giving preferential treatment to some services, both things that net neutrality would be built to stop. Instead, it’s about Netflix being allowed to connect its own content delivery network — most companies pay for third-party networks to deliver their content around the web, but Netflix has built its own to account for its incredibly high volumes of data — directly to Internet service providers like Comcast.

That doesn’t mean it doesn’t raise concerns about the future of the Internet, however. The Washington Post’s Timothy B. Lee argued that deals like this transform the Internet from its classic structure in which all sites’ content flow together to ISPs through a few big “pipes” — the structure on which the net neutrality ideal was built — to one in which each major content provider uses its own pipe which can be easier to individually manipulate.

Gizmodo’s Eric Limer said this deal relies on both sides’ size and encourages further consolidation: Comcast had enough leverage to sit back and wait for Netflix to pay up to fix its streaming quality problem, and Netflix was able to solve it being big enough to build “its own private highway.” Now, he wrote, “established champs who can pay for a separate tube have the advantage of not having to fight with a bunch of other traffic. It’s about to get harder than ever for something like Netflix to come along again.” Free Press pointed to the deal as evidence of the need for stronger anti-consolidation regulatory forces in Washington, and The New York Times’ Vikas Bijaj made a similar point in calling for the FCC to revisit its net neutrality stance.

On the other hand, Wired’s Robert McMillan argued that smaller players may not need or want a direct connection to ISPs like Netflix has, since they already pay third-party networks for that same connection and don’t stream nearly enough data to make it a serious problem like Netflix has. StreamingMedia’s Dan Rayburn said there’s nothing nefarious or threatening to net neutrality about this deal; Netflix is just shifting its costs for connecting to Comcast’s network from a third-party network directly to Comcast. “This is how the Internet works, and it’s not about providing better access for one content owner over another,” he wrote. In a follow-up post, Rayburn said this is a win for consumers more than anything, as we get better streaming quality and it costs Netflix less over time to give it to us.

Elsewhere in telecommunication, The Wall Street Journal reported on telecom giants’ fight against net neutrality laws in Europe and the U.S., and at In These Times, Jay Cassano and Michael Brooks said net neutrality’s erosion will disproportionately impact the mobile Internet and therefore lower-income people who depend on it.

An FCC news study becomes a political football: The controversy surrounding a proposed U.S. Federal Communications Commission study continued to boil over late last week into this week, prompting the FCC to suspend and revamp the study. The flareup started earlier this month with an op-ed in The Wall Street Journal by FCC commissioner Ajit Pai that raised an alarm about the FCC’s wide-ranging proposed study on “critical information needs” of communities, which included plans to interview journalists about how they select stories and what their news organization’s philosophy is. Pai said those questions represented an inappropriate government intrusion into newsrooms and raised the specter of government policing of journalism.

fcc_newlogoThe concerns were picked up widely across conservative media outlets, and the outcry led the FCC to axe the interviews of journalists, though it still plans to go ahead with the majority of the study involving surveys and interviews of citizens about the news they get. Even after that concession, a Republican congressman said he plans to hold hearings on the study and introduce legislation to block it entirely.

Others weighed with their views as well: USA Today’s Rem Rieder said the study isn’t an Obama-driven plot to control the press, but a poorly-thought-out attempt to determine whether citizens are getting key information. “The last thing we need is journalism cops flooding into newsrooms to check up on how the sausage is being made,” he wrote. Likewise, The Atlantic’s Conor Friedersdorf said the study hardly portends the return of the Fairness Doctrine, but looks like a waste of public money regardless.

FCC commissioner Mignon Clyburn defended the study, saying it’s simply meant to determine if there are any barriers to market entry keeping communities from receiving important information. Likewise, Wisconsin professor Lewis Friedland, who led the literature review that preceded the study, told the Columbia Journalism Review there was no government monitoring, intimidation, or coercion ever intended with the now-dropped journalist questions — “it was simply to get their point of view of how they understood the information needs of their local communities.” Techdirt’s Karl Bode delved into the study proposal and concluded that “It’s a fairly routine and entirely voluntary field survey designed to gather data. Nothing more.” Bode chided the FCC for kowtowing to conservative pressure to gut the study.

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Why Piers Morgan never clicked for CNN: The New York Times’ David Carr reported this week that Piers Morgan, the former editor of the defunct British tabloid News of the World, will have his prime-time CNN show canceled this spring. Morgan was given the key slot once occupied by Larry King, and the 81-year-old King told The Daily Beast’s Lloyd Grove he’d be willing to come back if CNN would have him.

Carr surmised that Morgan’s show never took off because his irrepressible Britishness never fit with an American audience and that his tirades against guns “have clanked hard against the CNN brand, which, for good or ill, is built on the middle way.” Time’s James Poniewozik said Morgan’s show was rife with problems, including his Britishness, his abrasive personality, and his longform style. Slate’s David Weigel argued that Morgan was ultimately a poor interviewer — either too deferential or too bullying — and The Washington Post’s Erik Wemple said that without a coherent overarching perspective, Morgan’s show was left to rely on the devalued commodity of the long-form interview: “In today’s America, there are so many outlets producing interviews, so many outlets for your message — that an hour-long interview program is almost programmed for obsolescence.”

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Options to break up the NSA: There were a couple of new revelations on government surveillance this week: Glenn Greenwald at The Intercept published documents from the Edward Snowden leak that detail how a group of the British spy agency GCHQ plants false information online to ruin the reputation of its targets and infiltrate online discourse to try to drive targeted groups apart. A German paper also reported that the U.S. National Security Agency has stepped up its spying on other German officials after it was told by President Obama not to spy on German President Angela Merkel.

The Wall Street Journal (paywalled) reported that the Obama administration is considering overhauling NSA surveillance in a variety of ways. Gizmodo has a good, quick summary of the options Obama is considering — let the phone companies oversee the phone metadata collection, letting a different federal agency hold the data, letting a different third party hold the data, or abolish the data collection program completely. At CNN, cybersecurity expert Bruce Schneier offered his own plan for breaking up the NSA that includes moving all surveillance of Americans to the FBI to bring it under U.S. law.

Reading roundup: A few other conversations and developments that bubbled up this week:

reddit-logo— Reddit is testing a live blogging-style update form for breaking news stories, something Gigaom’s Mathew Ingram said could be a real boon for the site and for social journalism. PandoDaily’s Nathaniel Mott said technical changes won’t necessarily change the site’s spotty track record for accuracy on news events, but Circa’s Anthony De Rosa said Reddit shouldn’t be dismissed as a potentially valuable link in the online news chain.

— Upworthy ran a correction this week for a faulty video it had run earlier, and it was distinct in that it consisted mostly of complaints from readers interspersed with apologetic GIFs from Upworthy staffers. Poynter’s Craig Silverman looked at the debate surrounding the correction and talked to Upworthy about why it made the correction that way. Upworthy’s Matt Savener also defended the site’s track record and editorial process.

— Politico’s Dylan Byers wrote a thorough piece on the failures of text-based news sites in producing compelling live video, and the Lab’s Joshua Benton looked at the consumers’ side of the problem as well.

— Finally, a few thought-provoking pieces from the week: The Atlantic’s Robinson Meyer and the Lab’s Joshua Benton on the boxy style that’s ubiquitous in newly redesigned news sites, Stack Exchange founder Jeff Atwood decried the proliferation of dumb apps, and journalism professor Jeff Jarvis gave some prescriptions for the relationship between philanthropy and news.

Photos of a Netflix envelope by Scott Feldstein and of Piers Morgan in a Burger King ad by Cow PR used under a Creative Commons license.

POSTED     Feb. 28, 2014, 10 a.m.
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