Netflix's encoding optimizations results in North American traffic share decline.

June 22, 2016

2 Min Read

WATERLOO, ON -- Sandvine, (TSX:SVC) a leading provider of intelligent broadband network solutions for fixed and mobile operators, today released its latest Global Internet Phenomena Report focusing on Latin America and North America. The report is based on data from a selection of Sandvine’s 300-plus communications service provider (CSP) customers.

Sandvine’s Global Internet Phenomena Report: Latin America & North America contains findings from both fixed and mobile networks, the highlights of which include:

• Netflix represented 35.2% of traffic on North America fixed networks. While this was a modest decline from the 37.1% of traffic it represented six months ago this change is likely the result of improvements by Netflix to better compress their video library. Even with these improvements in streaming efficiency, Netflix’s traffic share on fixed networks in Latin America increased from 6.6% to 8.3%.

• Amazon Video is now the third ranked downstream application (up from eighth a year ago) in North America, accounting for 4.3% of fixed traffic. Sling TV now appears among the top 20 applications on most US networks, but still accounts for less than 1% of traffic.

• Streaming audio and video now accounts for 71% of evening traffic in North American fixed access networks. Sandvine expects this figure will reach 80% by 2020.

• Cloud Storage (Dropbox, iCloud, Google Drive, etc.) has surpassed Filesharing as the largest source of upstream traffic during peak period on North American fixed access networks. BitTorrent now accounts for less than 5% of total daily traffic in the region.

• The addition of video and voice calling is driving growth in Communications apps on mobile networks in both Latin America and North America. In Latin America, WhatsApp traffic share is now 7.4%, more than triple what it was two years ago.

• In Latin America, Facebook and Google account for over 70% of total mobile traffic in the region, this is up from 60% reported last year.

• Over 60% of mobile traffic in both Latin America and North America is now encrypted and Sandvine predicts some networks will surpass 80% this year.

“Netflix’s decision to optimize their entire video library will yield benefits for both subscribers and operators,” said Dave Caputo, CEO, Sandvine. “Netflix’s optimizations means they can deliver more hours of video using less bandwidth, which results in lower data consumption for subscribers, and decreased capacity-related costs for operators.”

Netflix Inc. (Nasdaq: NFLX)

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