[jeffgus]

But Netflix was NOT paying transit. They were paying for peering. Transit costs more. To reduce costs, they peered with large networks. The problem is that the company they paid to setup peering (Cogent) didn't want to risk their settlement-free peering agreements. Cogent would have had to start paying for peering. It turned out it was much better for Netflix to setup their own peering agreements.

[bogomipz]

Incorrect. Netflix purchased transit from Level 3 beginning in 2010 and subsequently with Cogent.[1][2]. They then went on to purchase additional transit from Telia, NTT and Tata in order to get routes into the eyeball networks that began making a stink. They eventually agreed to do paid peering with the last mile eyeball networks - AT&T Verizon, Time Warner Cable and Comcast. It seem as though you not understanding peering and transit. Had they been paying for peering there wouldn't have been an issue in the first place. Paid peering was the very thing the last mile networks wanted.[3].

Netflix prior to the roll out of their Open Connect CDN offering used Akamai, Limelight, and Level 3 as their CDN providers. When they rolled out Open Connect they offered ISPs the ability to peer directly with them at number of different peering exchanges.[4] This was a few years after the Level 3 Comcast spat. You seem to be confusing events.

[1] https://qz.com/256586/the-inside-story-of-how-netflix-came-t...

[2] https://archive.is/2AC6C#selection-735.154-735.169

[3] https://arstechnica.com/tech-policy/2014/06/fcc-gets-comcast...

[4] https://techcrunch.com/2012/06/04/netflix-open-connect/

[jeffgus]

You are correctly. I was imprecise. They were trusting another company to peer for them. They thought they were purchasing "CDN services". The problem is that one of those companies was Cogent. Cogent prides itself with settlement-free peering. But since Netflix put so much traffic onto Cogent's network, it caused traffic to push beyond the peering agreements. Cogent didn't want to pay for peering. Once Netflix took on peering themselves, things went much, much better and the customers have been pretty happy ever since.

If Netflix understood peering from the beginning, they wouldn't have ran into these issues and might have saved themselves some money.

Peering is what saved the Internet back in the late 90's through early 2000's and proved Metcalfe wrong. People using the Netflix problem to push for NN were wrong.