At Alley Insider, Netflix CEO Reed Hastings discusses why he thinks those who short his stock are making a mistake. It is an interesting discussion generally, for its insight into how a shrewd executive views the development of content delivery via the Internet, but for purposes of Digital Society’s focus on Net Neutrality, the most interesting comment is Hastings’ view of his big source of competitive advantage — happy customers:

The core competitive barrier for direct competitors is brand/subscriber-evangelism. Our large subscriber base is very happy with Netflix, and tells their friends about Netflix. That means that the cost of acquiring the incremental 1m subscribers is lower for us than for a competitor, and thus our net additions are higher. There are also lots of other smaller competitive barriers, but the happy subscriber base is the big one.

It has long been known in business that customer interaction is more potent than the most expensive advertising, and the Internet is taking this to a whole new dimension because customer interaction now takes place among millions of strangers, not just in small groups.

Given this, how is it conceivable that the management of one of the major ISP brands — Verizon; Comcast; AT&T; whatever — would tick off its customers by cutting them off from content they desire? Indeed, as Hastings points out, anyone who creates demanded content can force the ISPs to pay them rather the reverse.

So why is the FCC considering an elaborate regulatory structure which will certainly slow down the speed of innovation and adaptation to protect against a hypothetical possible harm that has not in fact occurred in the past and which no business could inflict on consumers without cutting its own throat as a result of wide, and loud, outrage?

A message from John Furrier, co-founder of SiliconANGLE:

Support our mission to keep content open and free by engaging with theCUBE community. Join theCUBE’s Alumni Trust Network, where technology leaders connect, share intelligence and create opportunities.

• 15M+ viewers of theCUBE videos, powering conversations across AI, cloud, cybersecurity and more
• 11.4k+ theCUBE alumni — Connect with more than 11,400 tech and business leaders shaping the future through a unique trusted-based network.

Founded by tech visionaries John Furrier and Dave Vellante, SiliconANGLE Media has built a dynamic ecosystem of industry-leading digital media brands that reach 15+ million elite tech professionals. Our new proprietary theCUBE AI Video Cloud is breaking ground in audience interaction, leveraging theCUBEai.com neural network to help technology companies make data-driven decisions and stay at the forefront of industry conversations.