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Comcast tells FCC that Level 3's complaints have no merit

November 30, 2010 |  2:17 pm

Comcast has taken its fight with Level 3 to the next level.

In a letter to the Federal Communications Commission, the nation's biggest cable and broadband operator dismisses charges from Level 3 that it is behaving in an anti-competitive fashion. On Monday, Level 3, a company that serves as a content delivery network (CDN), accused Comcast of extorting a fee as part of doing business with it. The request for a fee by Comcast came about a week after Level 3 announced a deal to be a CDN for Netflix.

Although Level 3 never mentioned Netflix in its accusation against Comcast, the implication was that the cable and broadband giant was playing hardball with a competing distributor of content.

"Comcast is effectively putting up a toll booth at the borders of its broadband Internet access network, enabling it to unilaterally decide how much to charge for content which competes with its own cable TV and Xfinity delivered content," said Thomas Stortz, Level 3's chief legal officer. "This action by Comcast threatens the open Internet and is a clear abuse of the dominant control that Comcast exerts in broadband access markets as the nation’s largest cable provider."

Comcast, which is in the process of acquiring a controlling stake in NBC Universal and is facing regulatory scrutiny, told the FCC that this dispute is a business dispute and not about net neutrality or an open Internet.

"Despite Level 3’s complaints, Comcast is neither resisting carrying Internet video traffic nor imposing new 'tolls' on Internet video traffic," Comcast said in its letter to the agency.

Level 3, Comcast charged, bit off more than it could chew in its deal with Netflix. "Level 3's problem apparently arises out of the fact that it recently won a bid to become one of Netflix's primary CDN providers. ... Level 3 wants to avoid the commercial arrangements other CDN companies use."

Comcast argued that when a CDN such as Level 3 sends a lot of traffic to a broadband company such as Comcast, it is "expected to either remedy the situation or to pay something." Comcast said other CDNs, including Akamai and Limelight -- both of which also provide services to Netflix -- "typically purchase services from Internet backbone providers."

So confident of its position is Comcast that it said it would be willing to meet with Level 3 and FCC staffers to discuss the fight "if that will facilitate a better understanding of the matters at issue."

-- Joe Flint

Related post:

Netflix partner Level 3 accuses Comcast of anti-competitive behavior

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