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Federal Communications Commissioner Ajit Pai sent a letter to Netflix CEO Reed Hastings today suggesting that while Netflix advocates loudly for network neutrality and openness, the video giant has taken steps to create some Internet “fast lanes” of its own.

The letter states that Netflix refused to join an open standards group that would propose to standards bodies a common video compression standard that would make it easier for ISPs to cache and route video traffic.

When an ISP “caches” on caching devices in its own network, it no longer has to go back to the server where the video content originated. So if one ISP in Virginia gets a request for a piece of Netflix content from one customer, that piece of content can be cached on a server in that city. So the next customer who requests it can get it quickly from the cache, not from a server a continent away.

An open standard would also put all video traffic on the same footing, so that all video traffic could be delivered in the same way and at the same speed.

Commissioner Pai calls out Netflix for resisting such a standardization effort.

“Specifically, I understand that Netflix has at times changed its streaming protocols where open caching is used, which impedes open caching software from correctly identifying and caching Netflix traffic,” commissioner Pai says in the letter to Hastings.

He continues: “Because Netflix traffic constitutes such a substantial percentage of streaming video traffic, measures like this threaten the viability of open standards.

Pai also says that Netflix’s refusal to use an open standard might have something to do with its desire to get ISPs throughout the country to install Netflix’s own proprietary caching servers inside their networks at no charge. All major ISPs have refused this, except for Cablevision and Google Fiber. This has forced Netflix to strike interconnection deals with large ISPs to keep its video traffic flowing down to end users.

The initiative, which Netflix calls Open Connect, amounts to the installation of Neflix’s private content delivery network (CDN). CDNs like Akamai and Edgecast install their own servers inside ISP networks, but they pay for the right to do so.

If ISPs were to install open caching appliances throughout their network, all video content providers — including Netflix — could compete on a level playing field,” Pai writes. “If, however, ISPs were to install Netflix’s proprietary caching appliance instead, Netflix’s videos would run the equivalent of a 100-yard dash while its competitors videos would have to run a marathon.”

Netflix declined to comment on this story.

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