Netflix Now 33% Of Peak Downstream Internet Traffic In U.S.: Study

Though Netflix has hit a rough patch, its customers continue to stream more video than ever -- with the company alone now accounting for 32.7% of peak downstream traffic in the U.S., according to a new study from bandwidth-management vendor Sandvine.

Among fixed networks in the U.S., streaming video is the primary driver of network capacity requirements, representing 60% of peak downstream traffic, up from 50% in 2010. Netflix accounted for 20% of peak bandwidth consumption in the U.S., according to Sandvine's fall 2010 study. Peak network demand occurs between 7 p.m. and 9 p.m. local time.

In the fall 2011 Sandvine study, YouTube videos generated 11.3% of peak downstream traffic. That's even as the majority of broadband users (83%) use YouTube compared with 20% who use Netflix.

Netflix this week said it lost 800,000 U.S. subscribers -- more than anticipated -- following a change in plan pricing that raised prices for many members by 60%. As of the end of September, the company had 21.5 million streaming and 13.93 million DVD subscribers domestically.

Netflix expects four-quarter 2011 streaming-only customers in the U.S. to be flat or down by as many as 1.5 million subs.

Still, Netflix retains a large piece of the streaming-video pie, and with so many Netflix-capable devices in the market "it's hard to envision a scenario in which absolute levels of Netflix [usage] will decline," Sandvine said in the study. As such, most real-time Internet video now goes to non-PC devices, according to the report.

About 55% of streaming video traffic by volume over North American fixed networks is destined for game consoles, set-top boxes, broadband-connected TVs and mobile devices being used in the home, with only 45% going to desktop and laptop computers.

The problem with adaptive bit-rate video is that even when network capacity is increased, the stream "simply upshifts to a higher fidelity and fills the new capacity," Sandvine CEO Dave Caputo said. "The ‘build it and they will come' mentality falls short of objectives" in terms of meeting future demands.

Sandvine's Fall 2011 study is based on anonymous data in the month of September aggregated from more than 200 service provider customers in 85 countries.

For mobile networks, video is also a major driver representing 32.6% of peak downstream traffic in North America and 41.8% in the Asia-Pacific region. The largest contributor is YouTube. Traffic generated by mobile apps marketplaces account for 5.8% of peak downstream usage in North America and 9.4% in Asia-Pacific.

Among Netflix users, 77% of time spent watching video is via a TV-connected device, while 20% is on a PC and 3% is on a mobile device, according to Sandvine. YouTube usage is predominantly on computers, with 83% of time spent viewing on PCs, followed by 10% on mobile and 7% on connected TVs.