That sounds plausible at first, but is inaccurate on multiple levels. By early 2006, YouTube had substantial peering in place. It's easy to prove: they talked

That sounds plausible at first, but is inaccurate on multiple levels. By early 2006, YouTube had substantial peering in place. It's easy to prove: they talked about their programs at NANOG (https://www.nanog.org/meetings/nanog37/presentations/bill.norton.3.pdf https://www.nanog.org/meetings/nanog37/presentations/bill.no...). Without those, they would have folded already. They were acquired by Google only at the end of the year. Google doesn't own all of its fiber. Also, some ISPs have made public claims of being paid by Google for transit traffic. Google, but also ISPs, saves a lot of money through peering or the Google Global Cache. This is also why YT had peering in 2006: remember that traffic moves across multiple ISPs and it wasn't just YT's costs that were going to go up with their exponential growth. Last but not least, consider that Netflix doesn't own fiber – or at least haven't announced any – and they haven't been sunk by network costs, thanks to peering and edge caching. [I used to work at Google and knew at the time quite a bit about YT's infrastructure. The above is all public information.]