dave562 writes: "There was an interesting article posted on Zero Hedge lately on the throttling of Netflix.
'For years, the Netflix streaming business has been growing like a parasite, happy to piggyback on established broadband infrastructures, where the broadband companies themselves have becomes competitors to Netflix for both distribution and content. Until now. Emboldened by the recent Net Neutrality ruling, which has put bandwidth hogs like Netflix which at last check was responsible for over 30% of all downstream US internet traffic, broadband providers are finally making their move, and in a preliminary salvo whose ultimate compromise will be NFLX paying lots of money, have started to throttle Netflix traffic. The WSJ reports (Paywall) that the war between the broadband-ers and the video streaming company has finally emerged from the "cold" phase and is fully hot.'"
The internet has always been Bring your own Bandwidth.You pay for your own connection to your ISP, and your ISP pays the upstream and the upstream pays the backbone.
But Fnord666's post above, seems to suggest NetFlix sneaks its traffic onto the net without paying a cent. This is clearly false. They pay their ISP (they likely bypass everybody and connect direct to the backbone carrier) and they pay an enormous price.
So the OP is correct, all this grousing is double dipping by the local ISPs and low level upstream providers.
Still, as pointed out by others, Netflix works with ISPs to put their servers as close to the head-ends of ISPs so as not to inflate their traffic to the backbone. Every megabyte they save the ISP from having to pay the upstream is that much money left in the ISP's bank.