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CNN explores who is responsible for Netflix’s streaming problems on Verizon FiOS and AT&T U-verse. While one industry analyst seems keen to blame Netflix, his other articles on the subject show an increasing bias towards big ISPs like Verizon and AT&T. (2:54)

Netflix’s May speed rankings confirm Verizon FiOS customers are likely to find a degraded video streaming experience while using the otherwise speedy fiber to the home service. Netflix performance on Verizon FiOS dropped considerably last month — so much so that Frontier and Windstream DSL customers now get better Netflix performance than any Verizon customer receives. AT&T U-verse customers fared even worse with streaming performance below that offered by Mediacom — America’s bottom-rated cable company and CenturyLink DSL. In fact AT&T U-verse customers receive only marginally better service than Hughes satellite and Clearwire wireless customers. Verizon’s DSL came in dead last.

Coincidentally, both Verizon and AT&T, following Comcast’s lead, have been in negotiations with Netflix to receive payment from the streaming video provider to better handle its traffic. Verizon CEO Lowell McAdam said he’s confident about getting payments from Netflix, and he turned out to be correct — Verizon and Netflix reached an agreement in late April that is still being implemented. AT&T also says it is negotiating with Netflix. Verizon’s streaming video partnership with Redbox has not been affected by the sudden deterioration in online video streaming on Verizon’s network.

The problems with Netflix on some ISP’s have gone all the way to the top.

“My wife and I like to lay in bed and watch Netflix,” Tom Wheeler, chairman of the US Federal Communications Commission, said in January. The two companies serving Wheeler’s neighborhood are Comcast and Verizon. When enough customers launch streams on Netflix, saturating the inbound connection to either ISP, the video stops. When it does, Wheeler’s wife joins the parade of irritated customers.

“You’re chairman of the FCC,” she says to him. “Why is this happening?”

Last week, Netflix decided to answer that question with a more informative error message appearing when available bandwidth is insufficient to support a high quality stream.

“The Verizon network is crowded right now,” the message says. Netflix then attempts to restore the stream by serving up a degraded, lower quality/bit rate version to the paying customer.

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Bloomberg interviews Todd O’Boyle from Common Cause. He places the blame for this debacle solely on the shoulders of Verizon and other ISPs. (5:39)

The inability to successfully maintain a stable stream of Netflix content that ranges from 256kbps to 5.8Mbps seems odd on ISPs that offer customers connections far faster than that. The average Netflix stream is 2Mbps, slow enough to be comfortably supported on even a 3Mbps DSL connection. Netflix’s problems with Comcast evaporated after agreeing to pay the cable company to maintain a better connection between its customers and Netflix’s content delivery network. The same cannot be said for perfomance on AT&T’s U-verse platform. Although Verizon signed an agreement with Netflix, it has clearly not been implemented as of yet.

“We started a small-scale test in early May that lets consumers know, while they’re watching Netflix, that their experience is degraded due to a lack of capacity into their broadband provider’s network,” said Netflix’s Joris Evers. “We are testing this across the U.S. wherever there is significant and persistent network congestion.”

The companies with the biggest drops in Netflix performance are the same ones strongly advocating special paid “fast lanes” on the Internet for preferred traffic to resolve exactly these kinds of performance problems.

“Some large US ISPs are erecting toll booths, providing sufficient capacity for services requested by their subscribers to flow through only when those services pay the toll,” said Evers. “In this way, ISPs are double-dipping by getting both their subscribers and Internet content providers to pay for access to each other. We believe these ISP tolls are wrong because they raise costs, stifle innovation and harm consumers. ISPs should provide sufficient capacity into their network to provide consumers the broadband experience for which they pay.”

The error message fingering Verizon as the culprit for a poorer Netflix experience brought an angry response from Verizon on its blog:

Reports from this morning have suggested that Netflix is engaging in a PR stunt in an attempt to shift blame to ISPs for the buffering that some of its customers may be experiencing. According to one journalist’s tweet from last night, Netflix is displaying a message on the screen for users who experience buffering which says: “The Verizon network is crowded right now.”

This claim is not only inaccurate, it is deliberately misleading.

The source of the problem is almost certainly NOT congestion in Verizon’s network. Instead, the problem is most likely congestion on the connection that Netflix has chosen to use to reach Verizon’s network. Of course, Netflix is solely responsible for choosing how their traffic is routed into any ISP’s network.

[…] It is sad that Netflix is willing to deliberately mislead its customers so they can be used as pawns in business negotiations and regulatory proceedings.

It would be more accurate for Netflix’s message screen to say: “The path that we have chosen to reach Verizon’s network is crowded right now.”

However, that would highlight their responsibility for the problem.

Milch

That was quickly followed by a cease and desist letter from Verizon demanding Netflix remove error messages that blame Verizon for the problem. It also demanded a list of Verizon customers that received the Netflix notification.

“Failure to provide this information may lead us to pursue legal remedies,” wrote Verizon general counsel Randal Milch in a letter to Netflix general counsel David Hyman.

“This is about consumers not getting what they paid for from their broadband provider,” Netflix spokesman Jonathan Friedland said. “We are trying to provide more transparency, just like we do with the ISP Speed Index, and Verizon is trying to shut down that discussion.”

“Verizon’s unwillingness to augment its access ports to major Internet backbone providers is squarely Verizon’s fault,” Netflix general counsel David Hyman wrote.

“Netflix does not purposely select congested routes,” added Evers. “We pay some of the world’s largest transit networks to deliver Netflix video right to the front door of an ISP. Where the problem occurs is at that door — the interconnection point — when the broadband provider hasn’t provided enough capacity to accommodate the traffic their customer requested.”

Despite all that, Netflix also admitted it plans to drop the error messages after the “small-scale test” ends on June 16.

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CNBC explains how Netflix content gets to end viewers over a complicated series of Internet connections between Netflix and your ISP. (1:31)

TiVo Roamio DVR

The newest entry in the should-be-more-competitive world of Digital Video Recorders (DVRs) might have gotten five stars from reviewers willing to play down the device’s asking price, but the biggest hurdle of all isn’t its cost, it is the complexity of getting it to work properly with your cable provider.

TiVo’s new Roamio was designed to declutter your viewing experience. It’s a DVR that can record shows you missed, an online video device that can stream content from Netflix, Hulu Plus, Amazon Instant Video, Spotify, Pandora and YouTube right on your television, and perhaps most powerful of all — it will soon stream it all to you on any mobile device located anywhere there is an Internet connection.

That puts TiVo’s Roamio well ahead of the behind-the-times set-top boxes and DVRs rented out by the cable company. Customers have clamored for a device that can properly record scheduled programs and allow those recordings to be viewed anywhere the customer wants to watch. Comcast’s box doesn’t work that way. Neither do boxes from Time Warner Cable, Cox, Bright House, and the rest.

Cue the lawyers.

The reason these common sense portability features are not available on the box you rent in perpetuity from the cable company is that programmers won’t allow it and many pay television providers don’t consider it a priority. Time Warner Cable only recently filed a patent to deliver customer-recorded content to portable devices. The patent application is an exercise to placate litigious programmers that cannot sleep nights knowing someone is offering a service they failed to monetize for themselves through licensing agreements. Feel the legal fees piling up:

“Because of the increasing popularity of home networking, there is a growing need for a strategy that enables a user to perform authorized transfer of protected content, e.g., transferring content from an STT [set-top terminal] to a second device in a home network, and at the same time prevents unauthorized distribution of the protected content,” Time Warner writes in its patent application.

While TiVo is selling a device that allows consumers to record programming for private viewing purposes, a cable operator with deep pockets that only rents DVRs cannot do likewise.

The Roamio comes in three versions, none of which are compatible with satellite television services:

• Roamio Pro ($600): Six tuners allow customers to record up to six shows at one time and has storage capacity for 450 hours of HD programming. Includes built-in Wi-Fi. Stream TV to mobile iOS devices coming soon (as is Android support);
• Roamio Plus ($400): Same as above except storage capacity is 150 hours of HD programming;
  Roamio ($200): Four tuner basic version omits built-in streaming to mobile devices but can record four shows at once and store 75 hours of HD programming. A good choice for cord-cutters as it includes an over-the-air broadcast television antenna input.
• All Roamio devices require TiVo service, which costs $15 a month or $500 for a lifetime subscription. All boxes support external hard drives with an eSATA interface to backup or store more recordings. All Roamio devices support 1080p and Dolby Digital 5.1 sound.

This Comcast DVR is only available for rent.

In contrast, cable operator-provided DVR service can often add $20 a month to your cable bill… forever. But is there real value for money paying TiVo $15 a month (or a $500 payment for the life of the device) for “service” on top of hardware that can cost up to $600?

TiVo thinks so: “Once you bring together all your favorite shows, movies and music into one place, you’ll wonder how you ever lived without it.”

Unfortunately, getting there is one heck of a battle according to Bloomberg’s Rich Jaroslovsky, who got his hands on a test unit that simply refused to get along well with Comcast.

“The cable industry is standing in the way,” Jaroslovsky writes.

That may not be surprising, considering the lucrative business of renting DVR equipment to customers eager for time-shifting and commercial-skipping. The cable company’s concept of DVR service includes a set-top box, decoder, and recording unit into one, relatively simple integrated device.

TiVo’s persistent monthly “service fee” as well as a steep purchase price made marketing the cable company’s “no-purchase-required” DVR easy, and the cable industry quickly won the lion’s share of the DVR business. Another strong argument in favor of the cable company’s DVR is the lack of a complicated set up procedure to get competing devices to reliably work with the cable company’s set-top box.

Motorola’s M CableCARD

Thanks to Comcast and other cable companies, setting up Roamio managed to confound even a tech reporter like Jaroslovsky, and Comcast was not much help.

The Roamio requires a CableCARD, a plug-in card-sized version of the cable company’s set-top box, to unlock digital cable channels.

The CableCARD was Congress’ attempt in the 1996 Telecom Act to give consumers an option to avoid costly and unsightly set-top boxes. Originally envisioned as a plug-in device that would offer “cable-ready” service without a set-top box in future generations of televisions, the CableCARD never really took off. The cable industry opposed the devices and dragged its feet, preferring to support its own set-top boxes. The CableCARD that eventually did emerge was initially often difficult to obtain and had huge limitations, such as one-way-only access which meant no electronic program guide, no video-on-demand, and no access to anything that required two-way communications between the card and the cable company. Newer CableCARDs do offer two-way communications and support today’s advanced cable services.

The only place most cable operators mention the availability of the CableCARD in detail is in a federally mandated disclosure of pricing, services, and a consumer’s rights and responsibilities — usually provided in a rice-paper-thin, tiny-print leaflet included with your bill once a year, if you still get one in the mail.

Roamio is likely to frighten technophobes right from the start with this important notification:

CableCARDs are made by one of four manufacturers: Motorola, Scientific Atlanta/Cisco, NDS, or Conax. You need one multi-stream CableCARD (M-card). Single-stream CableCARDs (S-cards) are not compatible.

“That costs an extra $1.50 a month from Comcast, and in my case, required three trips to its nearest office because the first card didn’t work,” Jaroslovsky writes.

On the second trip, Comcast handed him two cards in the hope at least one would work, requiring one last trip to return the card that didn’t.

Time Warner Cable and certain other cable operators use Switched Digital Video, incompatible with the Roamio without a Digital Tuning Adapter, available from the cable company.

The second hurdle was to get Comcast to recognize and authorize that CableCARD. Comcast’s technical customer support staff was lacking. Jaroslovsky found his call bounced from department to department attempting to authorize the card and diagnose why it simply refused to work at first.

After finally overcoming those problems, Jaroslovsky discovered he was out of luck getting Roamio to stream premium movie channels like HBO and Cinemax. The encryption system Comcast supports prohibits streaming the movie networks outside of the home. The Slingbox works around the issue by bypassing the encryption system’s permission settings with extra cables between it and your cable box.

Time Warner Cable subscribers will need still another piece of equipment — a Tuning Adapter compatible with Switched Digital Video (SDV). To conserve bandwidth, cable companies like Time Warner limit certain digital channels being sent to each neighborhood unless someone is actively watching.

Before you can view or record a program on an SDV channel, your box must be able to send channel requests back to the cable headend. Roamio is a one-way device and cannot send the required channel requests. Cable providers who have deployed SDV technology will provide a Tuning Adapter to customers who have HD TiVo boxes. A Tuning Adapter is a set top box that provides two-way capabilities, so your box can request SDV channels. There are two Tuning Adapter brands: Motorola and Cisco. Motorola CableCARDs work with Motorola Tuning Adapters. Scientific Atlanta and NDS CableCARD work with Cisco Tuning Adapters. Without the Tuning Adapter, a Roamio user will find error messages on several digital channels indicating they are “temporarily unavailable.”

Other cable operators offer varying support for Roamio. Cablevision has been learning how to support the device along with customers. Prior customer experiences make it clear front-line service representatives are not going to be very helpful managing the technical process to properly configure, update, and authorize CableCARD technology for the new TiVo device, so prepare to have your call transferred to one or more representatives.

After all this, Jaroslovsky was finally watching his Comcast cable channels, able to access on-demand services, and found TiVo’s interface and program guide more satisfying than the one offered on Comcast’s DVR.

Roamio Plus and Pro have built-in support for video streaming away from home that will be fully enabled this fall.

Jaroslovsky found in-home streaming smooth and satisfying. Programs launched quickly and looked terrific on an iPad with Apple’s high-resolution Retina display, with none of the blockiness or stuttering sometimes associated with streaming video.

His review unit allowed him to test streamed programming outside of the home and video quality on the go was much more variable. The current software prohibits video streaming on AT&T’s 4G LTE network, a problem with a resolution now in the works. Public Wi-Fi hotspots often delivered poor performance, even when they could supply up to 2Mbps. Blurred pictures and pixel blocks often broke up the video on slow Internet connections. A faster connection supporting more than 10Mbps is capable of delivering a better viewing experience, especially if that connection comes without usage caps.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/TiVo Roamio DVR Demo Video 8-19-13.flv[/flv]

An introduction and demo of the TiVo Roamio DVR, produced by TiVo. (3 minutes)

This article was updated with a clarification about Tuning Adapters, required by some cable operators using Switched Digital Video. Thanks to reader Dave Hancock for helping clear things up.

In what Netflix is characterizing as a technical fault, those who experienced a limit of one-stream-per-“Unlimited Streaming”-Account can now watch at least two streams at the same time once again.

Stop the Cap! broke the story on Netflix’s streaming crash diet on Labor Day after being contacted by several readers reporting the apparent new limitations.  Stop the Cap! confirmed them ourselves several times over the past three days, and so did Mashable‘s Ben Parr, who ran into the same error message we did after trying to stream multiple movies at the same time (although he had no trouble watching one movie and one television show concurrently.)

Netflix’s spokesman Steve Swasey called it a big misunderstanding this morning, telling us “no Netflix member is limited to less than two concurrent streams. A few Netflix members have heard differently from us, which is an error that we are correcting.”

Perhaps, but the errors continued straight through until early this afternoon, when we were finally able to confirm the launch of two concurrent streams without an error message.

Netflix has always maintained streaming limitations in their terms of service and in their Frequently Asked Questions.  The company, to this day, still proclaims “you may watch [Netflix streaming on] only one device at a time” if you are a stream-only customer.  Their terms of service emphasize this point in all-capital letters:

YOU WILL BE ALLOWED TO INSTANTLY WATCH SIMULTANEOUSLY ON ONLY ONE SUCH DEVICE AT ANY GIVEN TIME. For certain membership plans in the United States, you may instantly watch simultaneously on more than one Netflix ready device within your household. Click here to view the number of devices on which you may simultaneously view movies & TV shows that are associated with your plan. The number of devices and concurrent streams may change without notice to you. For certain limited membership plans in the United States, your available Netflix ready device may be limited to personal computers.

While those clearly are the policies of Netflix, the reality has been customers could easily stream two or more concurrent shows over their Netflix streaming account from different devices without provoking an error message.  But that changed this past weekend, when we began to receive news tips from frustrated customers.

Some consumers never realized they could watch multiple streams at the same time, and were unconcerned with Netflix potentially limiting this feature.  For them, it was tantamount to abusing their Netflix account.  It is a fact some customers have shared their accounts with friends and family members, something that streaming restrictions would go a long way to discourage.  But there are legitimate uses as well, especially in large families with different viewing habits.

We feel it’s important for Netflix to convey exactly what their policy is regarding concurrent video streaming.  If Steve Swasey wants customers to feel assured they can watch two streams concurrently, their FAQ and terms of service should be updated to reflect that.  It’s clear Netflix reserves the right to change the number of devices and concurrent streams without notice, something our readers obviously feel very strongly about.

Whether this was truly a technical fault or a trial balloon that came crashing down under negative customer reaction, the message is clear: most customers are very glad to have concurrent streaming back, and hope it remains a part of the Netflix experience.