A sit down between Comcast (Nasdaq: CMCSA) and Level 3 Communications (Nasdaq: LVLT) engineers to discuss the two network providers' peering relationships ended when "Level 3 chose to leave ... when we wouldn't agree to a 'zero cost' outcome," a blog posting by Comcast's John Schanz, executive vice president of national engineering and technical operations said.
According to Schanz, the two sides were dealing with the issue of how to handle increased Level 3 traffic bolstered by streaming video content from Netflix (Nasdaq: NFLX) and had conjured a different architectural approach that would go to trial with Level 3 "as soon as next month." The trial, Schanz said, would help Comcast determine a cost structure for carrying increased loads of Level 3 traffic but "Level 3 effectively demanded unlimited capacity at our cost" and things devolved.
Although Level 3 left the meeting, it was apparent that Comcast was at an impasse because, said Schanz, the MSO believes that traffic flows should be more thoroughly studied to determine rate structures for carrying unbalanced loads of video traffic.
- see this blog post
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