P.S. Try scaling up a 100 servers on the cloud using Chef, then try doing that with tools/platforms from 10 years ago... No don't. It'd be irritating as shitting on an ant hill.
That's ops. If that's what you want to do, more power to you, but someone who wants to code wants to code; and those of us who just want to code are EXTREMELY happy to have ops and dev-ops people around. Personally, I'm happy on either side of the fence; less so if on both.
You've got it right, but I'll go into a bit more detail for you, as well. In the connectivity market, there are basically two products you have to be familiar with: peering and transit.
When talking about peering, two networks agree to connect to each other and pass each others' traffic, assuming the flow of traffic is more or less balanced. If there is an imbalance, the network sending the additional traffic agrees to pay those costs, because they derive benefit from the other network passing their traffic along. In short, peering arrangements work because two providers would otherwise waste time billing each other roughly equal amounts, spending more in the process of generating invoices, processing invoices for payment, writing checks, sending checks, accepting and processing checks, and closing out the paid invoices, than any small imbalance that might occur. And there are other providers available through which these networks can pass their data in order to have it reach a given endpoint, but these routes are often longer; peering benefits both parties by providing both with shorter routes to some endpoints.
Transit is almost the exact opposite of this; and both Netflix and Verizon purchase transit from Level3. With transit, the customer is buying connectivity, much like you or I would buy connectivity from a last-mile ISP, agreeing to pay for all traffic across that transit link. The reason for this is that Level3 derives no benefit from passing traffic through, or accepting traffic from, Verizon's network; rather, Verizon benefits from the connectivity Level3 provides.
Peering only works when one network is passing traffic through to another network, be that other network an endpoint, or another peering provider. Verizon is an endpoint (as it Netflix, thus why both purchase transit), meaning that the traffic that enters their network terminates within their network and the traffic that exits their network originated there, as well. They are not a transit provider that can offer peering arrangements, they are an endpoint that must buy transit, but they are trying to behave as though they are a transit provider.
It seems as though you already understood the general mechanics of this; hopefully these details can help cement that understanding.
The key elements in human thinking are not numbers but labels of fuzzy sets. -- L. Zadeh