A report out this week made quite a splash by claiming that Netflix, YouTube and other online video sites create nerly 46 percent of all Internet downloads during peak hours. See, for example, here, here, here and here.
But Kevin Fogarty at CoreIT says not so fast. Netflix isn’t swamping the Internet; ISPs are overstating their congestion problems:
Netflix doesn’t swamp the ISPs’ backbones or even their high-volume network spokes because its content is distributed and cached ahead of time. When it launches it travels only across the edge, vastly reducing the logic behind arguments by AT&T, Comcast and Verizon that they have to keep adding to their core networks to keep up with bandwidth-sucking competition from Netflix.
The second point that’s relevant for working geeks is that the level and reasoning behind data caps from AT&T and other ISPs vastly understimates what a “normal” level of Internet use really is. [See also here]
That affects consumer accounts most directly, but ripples out to business ISP accounts as well, in both data caps and data-consumption or bandwidth rates.
When AT&T announced its data caps – 150GB per month for DSL users and 250GB for broadband – it called the data levels “generous” and said limits would only affect 2 percent of its customers.
It turns out Netflix users take up an average of 40GB per month just from streaming media, according to a different Sandvine report (PDF),
Users that stream data through a device other than a PC – an Xbox or other game console, for example – use twice that amount of bandwidth for the same content.
That puts DSL users who stream movies through their Xbox 360s two-thirds of the way to their data cap every month before they download a single app or send a single email.
It also doesn’t include downloading YouTube videos or games, even the demos of which can rush anyone toward the data-cap limit without realizing it.
So what’s the game here?
[We are] allowing the FCC to avoid limiting the price-gouging plans ISPs impose on consumers and small businesses, rather than see through the smoke and realize it’s not compensating for Netflix that is taking up most of the carriers’ R&D and network-upgrade work.
It’s the effort to upgrade the nets to support their own streaming-media services, which not only compete with Netflix, but also come supported by internal business cases that have to show how quickly each new major upgrade will pay for itself through new services or the ability to support more subscribers.
Meanwhile, Verizon and AT&T are pitching HD video on mobile networks arguing that their network can handle it, a questionable claim given that the physics of the spectrum don’t support it.
Image credit: Business Insider Chart of the Day.