November 7, 2012
Netflix Sits On Top Of Prime-Time Video Streaming
Michael Harper for redOrbit.com — Your Universe Online
Remember when Netflix randomly announced they´d be spinning their DVD service into another business last year? Many Netflix users went straight to Twitter to complain about the new fees while some even went through the trouble of canceling their Netflix account, enraged that the company would ask them to pay extra to receive plastic discs in the mail in addition to being able to stream content immediately to their TVs. Investors were very worried that this could spell the end for the company and began selling stock in droves.
In their “Global Internet Phenomena Report” released today, Sandvine has found that Netflix had captured 33% of prime-time web viewing in September. This number surpasses the likes of other heavy-hitters, Amazon, HBO, Hulu and Time Warner.
“People are absolutely using their Netflix service,” said Dave Caputo, CEO of the Waterloo, Canada-based Sandvine.
“I don´t know whose library is better or bigger, but it´s very clear that people use Netflix a lot more.”
According to today´s report, Netflix´s peak Internet traffic sat near 20.6% in the latter half of 2010, climbing up to 32.7% the same time last year. Its competitors have yet to reach these same numbers, as Amazon only managed to capture 1.75% of the market share in September, with Hulu and HBO coming in at 1.38% and 0.52% respectively.
This kind of growth has even surprised Sandvine themselves, as they began predicting the beginning of the end for Netflix early last year as Amazon Prime and HBO Go were gaining in popularity.
“I thought the competitive threat would´ve been more significant against Netflix, but they seem to be holding their own,” said Caputo in an interview with Bloomberg. Though Netflix may be holding its own, it´s still important to note that Amazon has been able to grow from taking up a very small amount of bandwidth last year to becoming the 9th largest user in this report.
“Audio and video streaming account for 65% of all downstream traffic from 9pm-12am and half of that is Netflix traffic [on North America fixed networks]. Prioritizing real-time applications like live audio and video is critical to maintaining a high quality of experience,” said Caputo, who also expects the 2014 World Cup to be the most streamed event in Internet history.
Netflix hasn´t commented on these numbers yet, but in a recent interview with Bloomberg, CEO Reed Hastings has said he isn´t surprised that his company has been able to perform so well amidst the competition. According to Hastings, customers continue to choose Netflix due to a combination of “better exclusive content, better member experience, and a clearer brand identity.”
“We are working to expand these advantages to win even more of these moments of truth when consumers decide on any given evening what service they turn to first when looking for entertainment,”
Not surprisingly, the Sandvine report also found that YouTube was the largest consumer of mobile bandwidth, with Netflix and iTunes following after. The report also found that P2P file sharing via BitTorrent was still big in both Europe and the U.S., taking up a total of 16% of total traffic across the pond and 12% Stateside.