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Verizon CEO: We expect a deal with Netflix

Verizon CEO: Expect a deal with Netflix

Verizon Communications CEO Lowell McAdam told CNBC on Monday that he expects to reach an agreement with Netflix that would require the online video service to pay for bandwidth loads from streaming content.

During an interview on "Squawk on the Street," he said the companies have been talking for the past year.

"I'm not here to pre-announce and I'm not here to change my hand at the negotiating table, but I think there's a good opportunity here," McAdam said. "Both [Netflix CEO] Reed [Hastings] and I have talked about it and we think it's in both of our interests."

(Read more: Comcast customers to see improved Netflix speeds)

McAdam's comments come a day after a rival in the cable industry, Comcast (the parent company of CNBC), announced an agreement with Netflix that would allow for faster video streaming speeds.

The deal requires Netflix to pay Comcast for direct access, a first for the cable-broadband industry and an agreement that could act as a precedent for cable providers such as Verizon and AT&T. Terms of the deal were not disclosed.

"It's not a surprise that Netflix's been talking with everyone," McAdam told CNBC. "We've been talking to them for about a year. I don't know the details of the Comcast deal. I think it's a good thing. In order to keep the Internet vibrant, we have to make the investments."

(Read more: FCC will not appeal in key Verizon Internet case)

Last week, The Wall Street Journal reported that Netflix claimed its video content slowed down significantly on Verizon FiOS networks because of a disagreement over fees associated with the heavy bandwidth loads from streaming content.

McAdam said the Netflix deal shows that a "dynamic market" can self-regulate, a reference to the ongoing debate over "net neutrality" and the FCC's plans to seek rule changes that prohibit Internet companies from blocking content and from failing to treat content providers equally.

(Read more: How net neutrality debate could affect consumers)

Also last week, Verizon Communications completed its $130 billion agreement to buy Vodafone's 45-percent stake in Verizon Wireless. The deal should boost margins this year and help with plans to create a new product development unit, Verizon said Monday. McAdam also said he expects medical innovation to drive production of faster, fiber-optic networks that are able to transmit large files and conduct video conferencing.

"Vodafone was a great partner," McAdam said. "I think this was a win-win for us and them. What it allows us to do is speed. ... It allows us to see what customers want, and integrate those services and get them to market quickly. ... It's speed to market."

Asked to delve into Apple's much-anticipated product lineup for 2014, McAdam told CNBC that Apple CEO Tim Cook would not be pleased if he let anything slip.

"Tim would shoot me if I said anything about that," McAdam told CNBC. "I'm going to stay away from that. ... There's a pretty exciting road map ahead, but I'll let Tim tell you about that."

—By CNBC's Jeff Morganteen. Follow him on Twitter at @jmorganteen and get the latest stories from "Squawk on the Street." Reuters contributed to this report.

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