Big Interview

Netflix – maximum reach, minimal infrastructure

Dave Temkin 995x560.jpg

Dave Temkin of Netflix speaks to Natalie Bannerman about what makes the OTT content provider the number one downstream application in world and how it manages to scale so effectively

Netflix consumes 15% of the world’s internet traffic - at least that is what the numbers say. According to a recent report by bandwidth management company Sandvine, Netflix is the number one downstream application in the world.

Clever use of bandwidth and network management is needed to deliver immersive video experiences. On the part of Netflix, one of the people charged with this task is Dave Temkin, VP of networks.

Temkin credits the company’s Open Connect programme as one of the drivers of this trend of growing internet consumption. The programme enables internet service providers (ISPs) to deploy capacity as close to their end users as they need to, reducing costs and improving the experience of customers.

“Internet video is the future, and I believe that we are still very early in the shift from linear video to internet TV,” says Temkin. “Consumers want to watch what they want, when they want it – and Netflix helps accomplish that.”

Available in over 190 countries, Netflix has a presence in 97% of the world’s markets. So how does the content provider manage to deliver so much content on such a large geographic scale? Simply put, it does this through a purpose built content delivery network (CDN) combined with programmes such as Open Connect. In doing so, Temkin says, Netflix is able to deliver terabits of traffic at its peak while reducing cost and simplifying the process for ISPs.

“Having a fairly homogenous product allows us to realise advantages that most CDNs cannot, such as server hardware specifically optimised for delivering long form video, and a network that operates in a mostly decentralised fashion,” he explains. “By sharing these designs publicly we’ve also allowed others the ability to benefit from the work we’ve already done.”

Plans for infrastructure

Unlike its peers, such as Facebook, Google and AWS, Netflix has steered clear of investing in telecoms infrastructure. It’s widely known within the industry that OTTs are attracted by the cost benefits of becoming an owner, especially in the subsea sector where they are able to join a consortium of telecoms operators, that will manage the running and operation of these systems. However, because Netflix operates a little differently there is no business case for it to join the fray.

“We don’t purchase significant amounts of subsea or terrestrial fibre transport capacity, and the transport capacity we do purchase is used mainly for pre-positioning content on appliances,” Temkin says. “The most capacity we have on a single transport route today is 100Gb, and so because the amount we purchase is so small, the economics don’t work for ownership.”

On the tower side of things it’s a similar story. Temkin shares that a number of mobile providers have expressed interest in placing Netflix servers closer to end users, just not necessarily at towers. But once again, the economic and performance benefits don’t make sense for the company.

“Our application is not highly latency sensitive and the cost of fibre is going down while density is going up – nearly 40Tb dense wavelength division multiplexing (DWDM) systems are commercially available today,” explains Temkin. “The added complexity of having server hardware closer to the tower is unlikely to result in cost or performance improvements over and above what can be done by deploying Open Connect appliances in the middle and edge tiers of the network.”

Future trends

Though 70% of its users continue to watch content on TVs there are 30% who choose mobile. As mobile technology improves and devices get better it’s fair to assume some growth in mobile streaming. 5G is one of the emerging technologies set to revolutionise the mobile sector. Its impact is set to be far reaching and Netflix is no exception.

“5G will change the access dynamics for millions of users around the world, potentially opening up access to the service in ways that are not feasible today,” says Temkin. “We continue to focus on making Netflix work well on any network, no matter the bandwidth.”

Though the percentage of mobile users is small in some markets, it is the majority in others. Temkin and his team are committed to ensuring the application works well on all networks across all mediums.

“In some markets, like India, a more significant portion of viewing is done on mobile. We are working quite closely with mobile providers like Airtel to not only make our application work well on their networks, but provide consumers with promotions and bundles to reduce and simplify their monthly bill,” he comments.

Despite the company’s lack of presence in places like China and North Korea, Asia – particularly India - is a key market for Netflix Temkin says. Across the board, industry experts are beginning to see increased traffic coming from Asia, especially with the rapid uptake of content and gaming in the region.

“We presently have two points of presence in the market, and have plans to expand that to more this year. Our business has continued to invest in India, with local hit shows such as Sacred Games and Lust Stories,” he says.

In other countries in Asia Netflix is expanding its presence “both opportunistically and as customer growth warrants” and the local ISPs are focussed on delivering a great viewing experience to their customers, and Temkin says Open Connect enables them to do this.

Data and cloud

On the transport and storage side of things, we know that data is becoming too big to move in some instances – a problem that on the surface Netflix doesn’t seem to have on its networks. However, it is an issue on the content production side.

“People are often surprised to learn that productions are moved around on digital linear tape (DLT) or portable drive arrays. ‘Never underestimate the throughput of a truck full of tapes’ is just as true today as it was 20 years ago,” says Temkin.

Netflix hopes to change that by working with carriers to provide better connectivity to shooting locations and post-production processing facilities around the world.

“8K TV can generate nearly 15Tb of data an hour uncompressed; a day of production could easily generate nearly a half petabyte,” continues Temkin. “Creatives want to be able to see what was shot as soon as possible, often in real-time, and be able to remotely edit a production five or 5,000 miles away.”

Like many enterprises, Netflix is no stranger to the cloud ecosystem. “Today, our transcoding is done in the cloud. Having large on-and-off ramps for this data is paramount to our content workflow,” comments Temkin.

Netflix for games

The sky appears to be the limit in world of Netflix and the company says that it is constantly evaluating the marketplace to see if there is a great solution to their problem – either that already exists, or that they can help mature.

As it gears up for the rest of 2019, the company is exploring where 400G fits into its network. ISPs are also top of the bill, working with them to serve more traffic from an even smaller footprint because more ISPs are concerned with lowering their space and power consumption.

“With our ability to serve hundreds of gigabits per second from only a few rack units of space, we’re helping them achieve those goals,” Temkin adds.

SDN is also a key area of development for Netflix particularly in its delivery and enterprise networks. He says they are starting to see interesting hardware in that space, and he is “excited that off the shelf network operating systems are reaching maturity”.

One of the more exciting possibilities for the company is to enter into the video game streaming arena. A subscription-based game streaming service has been a consumer want for some time now and enterprises are finally starting to pay attention.

Other industry players have already began work on their offerings, with Sony deploying PlayStation Now and Google working on its Play Pass product. Recently Microsoft also threw its hat into the ring with its Project xCloud. Apple has also confirmed that it is working on something in this space with users paying a subscription fee to access a list of titles.

Microsoft’s CEO Satya Nadella has aptly labelled this vertical as ‘Netflix for games’ so naturally it would make sense to Netflix enter this market themselves and it’s a proposition that might be closer than you think.

As Netflix says in a recent letter to shareholders, “We compete with (and lose to) Fortnite more than HBO. ... Our focus is not on Disney+, Amazon or others, but how we can improve our experience for our members.”

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