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TechNetflix

Why Netflix Decided to Back Net Neutrality After All

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Aaron Pressman
Aaron Pressman
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By
Aaron Pressman
Aaron Pressman
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June 15, 2017, 3:35 PM ET
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Netflix has long been the poster child of companies that might not exist if the Internet had been locked down and controlled more heavily by the cable and telecommunications industry in its early days.

But as the video streaming pioneer has become a powerful player with nearly 100 million subscribers, it has been less obvious how strongly the company would fight to keep the Internet free and open for new businesses, including possible new competitors. Netflix originally lobbied in support of federal rules to protect net neutrality, which prohibit Internet service providers like Comcast (CMCSA) and Verizon (VZ) from blocking, slowing, or otherwise discriminating against any web site or online service.

But as the Trump administration recently moved to repeal the rules, its position got a little murky. Being so popular, Netflix has more clout if ISPs try to push it around, so it may not need the rules as much as it once did.

On Thursday, Netflix moved to clear up the confusion, coming out strongly in favor the 2015 rules,

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“Netflix will never outgrow the fight for #NetNeutrality,” the company tweeted from its official Twitter account. “Everyone deserves an open Internet.”

Netflix also included a link to organizers of an upcoming day of protest on July 12, when many web sites plan to show their support for net neutrality. Amazon (AMZN), Etsy (ETSY), and Mozilla are among other Internet companies that have already said they would participate.

The confusion over Netflix’s position may be because the company doesn’t want Wall Street to see it as financially vulnerable to demands from the big Internet service providers if the net neutrality rules are repealed. Last month at the Code tech conference in California, Netflix CEO Reed Hastings said that net neutrality was no longer “our primary battle at this point.”

“We had to carry the water when we were growing up and we were small and now other companies need to be on that leading edge,” he said.

But that shouldn’t have been seen as a signal Netflix (NFLX) would abandon its allies, a spokesman for the company said on Thursday.

“Netflix’s position remains the same: we support strong net neutrality protections, even if we are at less risk because of our popularity,” the spokesman said. “There are other companies for whom this is a bigger issue, and we’re joining this day of action to ensure the next Netflix has a fair shot to go the distance.”

The Federal Communications Commission adopted the net neutrality rules under chairman Tom Wheeler, appointed by President Obama. But under Trump-appointed chairman and former Verizon lawyer Ajit Pai, the agency has proposed rolling back the rules without saying how it planned to prevent potential online business discrimination.

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