Video Killed the Radio Star… Is the Internet Next?

Netflix hit 20 million subscribers last year, and with reportedly over 60% of their subscribers streaming video over the Internet, the pressure they are putting on the Internet as a delivery system for television shows and movies has taken center stage lately. Netflix holds the most notoriety as the leader of the pack, but Hulu and even DirecTV through its on-demand service delivered over your broadband connection have been at it for years.

The heart of the problem is that a single movie viewed in a day can consume magnitudes more bandwidth than a traditional Internet user will consume in a day through typical Internet browsing, email and social network use. Consider this example graphing a day of “traditional” Internet use for a single home in which a total of 150 Megabytes of data is downloaded in short bursts of use:

Graph of Normal Internet Use: 150MB Downloaded

Then consider the graph with a Netflix movie on a Netflix rated “Medium Quality” connection where nearly 1500 Megabytes is consumed:

Graph of Internet Use with Netflix Movie on Medium Rated Connection: 1500MB Downloaded

And then the network operator’s nightmare customer that runs a webcam uploading a nearly constant 700 Kbps, and downloads Season 3 of Dora the Explorer on Itunes for a whopping 10 Gigabytes of data transferred:

Download of Season 3 Dora the Explorer Plus Web Cam Traffic: 4.7GB Downloaded 5.1GB Uploaded

Consumer Internet access in its current state is designed to support the usage in the first example, and there is generally enough flexibility and capacity to support a small proportion of heavy Internet users without slowing everybody down. A parallel example is the sewer system: only a few people in a particular neighborhood happen to flush their toilet at the same time, and the sewer pipes are generally big enough to support to the anomalous times of heavy simultaneous usage like half-time during the Superbowl. Now imagine if everyone in your neighborhood replaced their 1.6 gallon toilet tanks with 16 gallon tanks, with a few of the geekier neighbors dropping in 160 gallon tanks. There would be a whole lot of wet bathroom floors pretty quickly all over your neighborhood as the sewer system backed up. In the case of an Internet access network clogged up with video, we face the prospect of crawling speeds as computers on either end of the connection wait their turn to send packets through the network.

On the bright side, expanding the capacity of the Internet to accommodate video distribution is a lot more feasible than retrofitting all the sewer systems in the world. The big question is who will pay for it? The cost to deliver large amounts of one way video has traditionally been paid for by the consumer in the form of a cable TV or satellite bill. In the case of nearly defunct broadcast TV it was paid by the advertisers. Streaming video providers like Netflix are simply poaching the Internet connection of the consumer and shifting a large portion of the delivery cost on to the Internet access provider. Internet access providers like Comcast are chafing at bearing the cost of delivering Netflix’s movies across their Internet network, and to add insult to injury are also faced with the long-term prospect of losing their cable TV customers to streaming content providers. Last November Comcast threw a challenge flag onto the playing field in the form of a well-publicized dispute with Level 3, a deliverer of Netflix content, and has been battling along with Verizon against the FCC over their net neutrality efforts that would forbid network providers from discriminating against any content. Video doesn’t belong on the Internet in its current form, and without a mechanism to ensure providers and consumers of video pay their share of the delivery costs, we may very well wind up back in the days of dial-up speeds. In the mean time the Internet creaks a little bit each time Netflix adds a new streaming subscriber.

Author’s Note: I am a huge fan of Netflix and believe they are one of the most transformational companies of the Internet age. I also can’t argue with the convenience of streaming video, but as a network operator I acutely feel the stress it puts on the current model of Internet access.

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6 Comments

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6 responses to “Video Killed the Radio Star… Is the Internet Next?

  1. Hey old timer Dave, I bet you were saying stuff like this back in the day when mozilla came out with a way to display fancy images instead of just text ๐Ÿ™‚ Complaining about all that bandwidth those images were taking up compared to some good old fashioned text! The Internet is not for images it’s for BBS, who is going to pay to take us from 56Kbps to something faster?! The Internet is doomed! I’m sure people were complaining that the publishing industry was getting a free ride because they could now publish their articles without all the cost of printing and distribution. Perhaps you should have to pay each of the ISPs for transmitting this blog. This is just the evolution of the Internet!

    Also consumer broadband companies like comcast have seen profits more than double , stating that their costs have DECLINED??!! http://bit.ly/g2tTUU Shouldn’t they have to take some of that $50/month I pay them and reinvest it back into their infrastructure to continue to deliver me the bandwidth I pay for? Or is it just easier to complain about Netflix to ensure their costs continue to deline further.

    Bandwidth unlike water or gas is not a scarce item. We can’t run out of bandwidth, like we can gas. It is the responsibility of the carriers to reinvest back into their network to keep up with technological advances.

    -Chris

  2. Jr Aquino

    Netflix is just the first legitimate non-taboo big chunk on the net.

    Instead of trying to argue how to be more like the cable company (evil), Providers should focus efforts on pro, not anti consumer movments.

    IPv6, DNSSEC/CurveDNS, an updated spec to BGP! ๐Ÿ˜‰

    • Jr – Funny cartoon, but I had to yank it. I didn’t get into the technical details in this piece since I was more focused on demonstrating the problem. Exploiting peering relationships to dump hoards of one way traffic onto other providers networks is kind of like using rural phone networks (that charge high rates to other carriers to provide phone service to their few rural users) to make money off free conference calling – it may be legal but it doesn’t make it right.

  3. Ted

    Hey everybody. ๐Ÿ™‚ Realistically, as long as the customers
    don’t see the impact, nothing will change. As you say, right now,
    we have enough excess bandwidth to support the current usage.
    However, as usage grows, costs will have to go up. Those costs can
    either be charged to the customer or to the provider, but
    regardless, they will go up. Any provider who is in a cost-free BGP
    peering agreement with Netflix should be reconsidering those
    agreements in the future. If Netflix is truly generating that much
    traffic, then they should have to pay for the traffic they
    generate. Is there any indication that the big content providers
    (Netflix, Google, etc.) aren’t paying for the bandwidth they use? I
    understand that content creates costs all across the system, but
    you could just as easily flip the argument around and say that the
    customers who are consuming Netflix’s content are consuming too
    much bandwidth on the networks that Netflix is peering with.
    Fundamentally, the cost of traffic must be assessed on its impact
    across each ISPs network, not just at the edge. On the consumer
    side, different companies will oversubscribe their lines to
    different levels, and customers will choose based on the network
    performance they get. A network that is based on the old model will
    not provide the performance that customers demand, and those
    customers will switch to other providers that meet their needs,
    likely at higher costs. What we need is a competitive network
    access marketplace, where ISPs can provide different levels of
    service at different costs.

    • Good points Ted. When Netflix started Level 3 as a Content Delivery Network to get put their content on the net last year it caused a squabble with Comcast since Level 3 was pushing the traffic through their peering arrangement. Comcast forced Level 3 to to start paying for that traffic, and we’ll see if those costs eventually make their way back into Netflix’ pricing.

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