I agree, it ultimately ends up being a cost issue.
Analogies just start to break down a bit when you consider the fact that these consumers aren't making these requests of Netflix's CDNs on their own. Netflix is giving them an app that does this, so Netflix the company is actually in charge of the volume and direction of these requests from start to finish.
From what I gather from Level3's blog post, they've built out a lot of extra capacity to specifically handle the kinds of traffic that a company like Netflix would be pushing, and that the ISPs have not done so, intentionally, and are trying to get Level3 and others to pay the costs for the upgrades.
Why? Well, again from what I've gathered from the submission and Comcast's article on the same topic, it's because they don't want ALL of their customers paying for upgrades that will only benefit the folks who actually use that increased capacity - specifically, Level3's content. If I don't use YouTube and Netflix, the argument goes, why should I have to pay for the upgrades that'll only benefit Netflix and YouTube? The ISPs are therefore saying that the folks providing the content would be the best ones to pay for these upgrades, because that way the costs are only on the consumers paying for the services (in the form of money or ad views), instead of all of the ISP customers.
Now I think the debate can really take place once we start talking about "who benefits" from these upgrades. The ISPs appear to be saying Netflix, et. al. are the only beneficiaries, and Netflix, et. al. are claiming that since the upgrades are taking place on the ISP side, everyone who is a customer of the ISPs would benefit from the upgrades.
I tend to side on L3's notion that upgrading the interconnects is something with such a large pay-off it's miserly to even consider worrying about it. My understanding of it is that as the pipes get larger demand follows to consume more, and with higher demand comes a greater market to serve. And you can bet many companies salivate at the chance to get a piece of the Netflix pie (including Verizon et al.)!
It always struck me as duplicitous of the ISPs to talk about who holds the cost for the Netflix volume, since most are also attempting to sell in the same market as Netflix (namely streaming video and TV shows). It just smacks of conflict of interest. It's not like Comcast, Verizon, and Time Warner don't all stream _enormous_ amounts of video either, and it's not like I as a consumer care about all the technical nonsense. (I also was terribly underwhelmed by the switch to HD broadcast TV, and generally feel like the signal glitches are so grievously bad and corrupted that surely someone pulled a fast one there.)
Really, I suspect this whole mess may merely be the result of the companies providing the pipes also competing on content, and their roles get muddied. We expect to be able to abstract away all that peering nonsense as a consumer, and since the Internet is so stupefyingly big, creating special cases seems like an unreasonable burden to push on the typical consumer who neither understands not cares how the magic info-pipe works (my personal stance).
Of course the techie part of me has a load of popcorn to see how it turns out. As I noted elsewhere, it kinda doesn't matter who is technically right. My money is on the angry ignorant masses who just want some shows before sleep, and against whomever they blame. So far, my money's on Netflix, as cable companies are somewhat reviled by comparison.
Analogies just start to break down a bit when you consider the fact that these consumers aren't making these requests of Netflix's CDNs on their own. Netflix is giving them an app that does this, so Netflix the company is actually in charge of the volume and direction of these requests from start to finish.
From what I gather from Level3's blog post, they've built out a lot of extra capacity to specifically handle the kinds of traffic that a company like Netflix would be pushing, and that the ISPs have not done so, intentionally, and are trying to get Level3 and others to pay the costs for the upgrades.
Why? Well, again from what I've gathered from the submission and Comcast's article on the same topic, it's because they don't want ALL of their customers paying for upgrades that will only benefit the folks who actually use that increased capacity - specifically, Level3's content. If I don't use YouTube and Netflix, the argument goes, why should I have to pay for the upgrades that'll only benefit Netflix and YouTube? The ISPs are therefore saying that the folks providing the content would be the best ones to pay for these upgrades, because that way the costs are only on the consumers paying for the services (in the form of money or ad views), instead of all of the ISP customers.
Now I think the debate can really take place once we start talking about "who benefits" from these upgrades. The ISPs appear to be saying Netflix, et. al. are the only beneficiaries, and Netflix, et. al. are claiming that since the upgrades are taking place on the ISP side, everyone who is a customer of the ISPs would benefit from the upgrades.