AT&T Disputes Netflfix OVD Allegations, Opposes DirecTV Deal Condition

14-90, AT&T tweaked Netflix for opposing the AT&T/DirecTV deal after previously saying it would be a "plus for Netflix." AT&T disputed the contention that Netflix would be harmed unless AT&T is barred from charging content providers seeking to connect to its networks. The FCC "should reject any such condition, especially when imposed on only one company in a hotly-contested broadband marketplace dominated by incumbent cable companies," said the telco. It said Netflix overlooked its agreement to gain long-term direct access to AT&T's network "on terms that will allow Netflix to continue to thrive in the marketplace." AT&T said Netflix enjoyed "spectacular" growth since 2013, even when it encountered network congestion, and AT&T cited reports that Netflix commented that recent interconnection deals, such as with AT&T, wouldn't hurt its margins. AT&T included information about its Netflix contract with the specifics redacted. AT&T said Netflix ignored two technological and economic realities: "AT&T could not effectively and persistently degrade any OVD without degrading all OVDs and degrading any single OVD, much less all OVDs, would risk significant loss of broadband and bundle customers while saving few, if any, video customers." It would be self-defeating for it to degrade OVD performance because it could lose broadband profit and "much greater double and triple-play revenues and profits, which include video profits," said the telco. "It makes no economic or business sense for AT&T to pursue the hypothetical OVD degradation strategy put forth by Netflix, either before or after the transaction."