So maybe someone can explain this to me because I don't entirely get it.
Right now Level 3 doesn't pay Verizon any additional money for the data being sent its way (yes, requested by Verizon customers, but transport is usually paid by the shipper -- when I order a physical product I pay for shipping to the vendor, who pays the transporter).
The reason Level 3 doesn't pay any more is because they are using settlement-free links established to provide basic bi-directional communication between the two networks. Because of the way they are using them, these links (which are set up to provide balanced access) are saturated in one direction while only 30-60% utilized in the other direction.
The point made by both companies is that fixing the congestion is a simple matter of hooking up a couple ports (which would increase the utilization of Verizon's network).
Level 3 wants Verizon to agree to expand the settlement free ports to allow for the imbalance of traffic. Verizon says "our settlement free ports are sufficient for normal traffic, and if you want to avoid congestion for the additional traffic you are charging Netflix to carry then you're going to need to purchase additional ports and pay for that traffic."
Neither wants to budge and so they fight a PR war about it. Level 3 says "It's just a couple ports and a little cable" while disregarding the downstream impact on Verizon's network. Verizon says "Level 3 is taking undue advantage of our mutually beneficial arrangement and wants us to help them do it for free."
Is this accurate?