Netflix “refused” To Answer Encryption Allegation, Fcc Commissioner Says

Netflix refused to turn over information it had promised to give the Federal Communications Commission, an FCC commissioner said.

Ajit Pai, part of the commission's Republican minority, has clashed with Netflix over its use of technology that is not compatible with "open caching software" used by Internet service providers. Netflix says that it "obscured certain URL structures to protect our members from deep packet inspection tools deployed to gather data about what they watch online," which apparently had the side effect of forcing ISPs to use different caching systems. Netflix does offer caching appliances to Internet service providers, but the bigger carriers have refused, demanding payment for connections to their networks.

Pai met with Netflix in person but the dispute is unsettled. In a statement issued today, Pai wrote:

Late last year, I was surprised to hear allegations that Netflix had taken actions to undermine the development of open standards for streaming video. I asked Netflix to respond to these allegations, with a specific focus on whether the company had changed its streaming protocols where open caching was used in a way that impeded open caching software from correctly identifying and caching Netflix traffic.

Netflix responded to my inquiry both in writing and in person. These discussions were initially quite productive. Through our exchanges, I learned that Netflix began encrypting URLs at some point in 2014. Moreover, the company indicated that it was contemplating making additional changes in the near future to its encryption practices. Netflix did not deny that these actions could impede the operation of open caching software, but contended that its motive was to protect its customers’ privacy, not to undermine open video standards.

In order to test the validity of this assertion, I then asked Netflix to respond to the allegation that it had rolled out its new encryption protocols by first targeting those ISPs that had installed open caching appliances. The company assured me that this was not true and agreed to submit information after our meeting that would disprove this charge.

One month later, that commitment remains unfulfilled. When my office reached out to Netflix for the information (in particular, which ISPs were targeted on which dates), the company refused to turn it over. I am disappointed and perplexed by this decision. If Netflix did not target those ISPs using open caching, why would it withhold information that would disprove this allegation? I hope that the company will reconsider its position and supply the facts that would resolve this matter once and for all.

Pai went on to say that he does not favor additional FCC regulation in this area, but he says Netflix's practices should be compared to its demands for heavier regulation of Internet service providers, "f a company asks the FCC to impose public utility-style regulation on every broadband provider in the country in the name of preserving the open Internet but then selectively targets open video standards to secure a competitive advantage over its rivals, it should be called to account," Pai wrote.

"We have responded to all of Commissioner Pai's questions," a spokesperson for Netflix told Ars in an e-mail. "He appears to be targeting us because he disagrees with our Open Internet advocacy, not because of our efforts to protect member privacy."

Separately, the FCC is also examining Netflix's paid network connection deals with ISPs.