Netflix, the popular OTT video provider that has reluctantly agreed to enter paid interconnection deals with some of the nation’s largest ISPs, cheered the FCC’s vote to reclassify broadband under Title II and introduce new network neutrality rules that, for example, will open the door to a case-by-case review of interconnection-related complaints. 

“Today’s order is a meaningful step towards ensuring ISPs cannot shift bad conduct upstream to where they interconnect with content providers like Netflix,” Netflix said in its statement. “Net neutrality rules are only as strong as their weakest link, and it’s incumbent on the FCC to ensure these interconnection points aren’t used to end-run the principles of an open Internet.”

But does Netflix plan to bring any interconnection-related complaints to the FCC in the wake of Thursday’s vote? Stay tuned.

“We will review the order and decide next steps,” a Netflix spokeswoman said via email.

The FCC is expected to release the order in the coming weeks. In a fact sheet on the matter released on February 4, the FCC said the rules would, for the first time, give the Commission the authority to hear complaints and take appropriate enforcement action if necessary, if it determines the interconnection activities of ISPs are not just and reasonable…” 

Netflix has been urging the FCC to consider paid interconnection deals as it pursued the new rules, labeling such agreements  an “arbitrary tax” on the company and other over-the-top video service providers.

Netflix, which prefers that ISPs join its Open Connect program, which relies on Netflix-supplied edge caches, has reluctantly signed interconnection pacts deals with Comcast, Verizon Communications, AT&T and Time Warner Cable. Bright House Networks is benefitting from TWC's deal with Netflix. 

ISPs have maintained that paid interconnection deals are common to the business of the Internet when settlement-free peering no longer apply as the amount of traffic entering and exiting peering points is out of balance. 

Even if Netflix decides to issue a complaint, some analysts believe it will face a tall task. “Netflix will have a hard time trying to convince the FCC that they are being mistreated when the interconnection deal they have with Comcast costs them less money than using transit providers and third-party CDNs, improves the video quality for consumers, and comes with an install SLA, packet loss SLA and latency SLA from Comcast,” Dan Rayburn, EVP of StreamingMedia.com and principal analyst at Frost & Sullivan, said in this blog post earlier this month.

Update: Netflix signaled before the vote that it might stand pat, at least with respect to its current interconnection agreements. Speaking on Netflix’s fourth quarter call on January 20, CEO Reed Hastings  noted that the Title II rules should, over time, “significantly insulate us from any accelerating tax for interconnections,” but added that Netflix would “likely live out the current deals…that’s what’s in our plan.” 

AT&T and Verizon Communications both made significant jumps in Netflix’s ISP Speed Index for August, delivering higher-quality Netflix streams following recent paid interconnection deals between the ISPs and the OTT video giant.

Those gains helped to push the U.S. average speed, as ranked by Netflix, to 2.57 Mbps in August, versus 2.23 Mbps in July, putting the U.S. in 11th place among countries tracked by the streaming service. The Netherlands (3.63 Mbps average) remained the top country, according to Netflix, which has been urging the FCC to include paid peering deals in its vetting of new network neutrality rules and has thrown its weight behind the symbolic Internet Slowdown Day protest slated for September 10.

Among the 16 major U.S. ISPs ranked by Netflix, AT&T U-verse leaped seven spots, to No. 7 on the list, delivering an average Netflix streaming speed during primetime hours of 2.61 Mbps, up from 1.44 Mbps in July. AT&T DSL, meanwhile, hopped two spots, to No. 13, with an average of 1.81 Mbps, up from 1.11 Mbps in July.

Verizon FiOS’s average of 2.41 Mbps for August enabled it to climb two spots, to No. 10, beating its July average of 1.61 Mbps. Verizon DSL averaged 1.31 Mbps for August (versus 970 kbps in July), but still finished last among the large U.S. ISPs as viewed through Netflix’s prism.

Other ISPs also gained. Comcast, which announced its interconnection deal with Netflix in February, rose one spot, to No. 4, swapping places with Charter Communications.

Mediacom Communications, which uses a “transparent” caching system from Qwilt in lieu of Open Connect, a private CDN program that uses Netflix-supplied edge caches, gained two spots, to No. 6.

Several other ISPs lost ground in the rankings, even though some produced better results versus the previous month.

Fresh off an interconnection deal with Netflix announced last month, Time Warner Cable averaged 2.59 Mbps in August, up from 2.16 Mbps in July, but still dropped two spots, to No. 8.

Bright House Networks, Frontier, Windstream, and Clearwire all dropped two spots, and CenturyLink fell three spots.

The top three -- Cablevision Systems, Cox Communications and Suddenlink Communications – finished in the same order as they did in July.

Google Fiber (3.53 Mbps) retained the crown for Netflix’s expanded U.S. ISP rankings.