Netflix Consuming 1/5 of All Internet Traffic: Report

A new report has revealed that Netflix video streaming accounts for an incredible 22 per cent of all Internet traffic.

This number is considerably higher than last fall, suggesting that the site's popularity and overall interest in Internet streaming has climbed significantly in the past six months.

While the average Internet usage represented by Netflix users was around 22 per cent, researchers at analyst firm Sandvine found that during peak usage periods Netflix accounts for as much as 30 per cent of all Internet traffic. Sandvine says this is 10 per cent higher than was reported back in October 2010. (Source: csmonitor.com)

At this point Netflix is even surpassing file-sharing system BitTorrent (which accounts for 21 per cent of Internet usage) in its appeal.

Netflix All About Instant Entertainment

Sandvine CEO Dave Caputo believes Netflix's popularity represents a growing desire on the part of consumers for instant gratification when it comes to digital media.

"The dramatic growth of Netflix and its impending global expansion are prime examples of a growing appetite for real-time entertainment," Caputo said.

It's easy to see why Netflix is so popular. For just $8 a month -- less than the price of a Blu-ray rental at some brick and mortar video outlets -- members get access to a large database of films and TV shows.

Netflix can be easily accessed through a PC or a number of video game consoles, including the Sony PlayStation 3, Microsoft Xbox 360, or Nintendo Wii. It's also legal, which is more than can be said for many of the files moving through BitTorrent.

There's also a lot of room to grow: after all, many of the titles available in the Netflix library are painfully old -- were the company to land a deal giving users access to newer content (perhaps at a slightly higher membership fee), the service's popularity (along with its Internet usage) might just shoot through the roof.

Future Impact on Internet Service Providers Unknown

Of course, Netflix isn't the only streaming video service hogging bandwidth. Together, it, along with YouTube and similar video sites, account for nearly half of all Internet traffic. If these kinds of services continue to grow, the pressure placed on Internet Service Providers (ISPs) could represent a real problem. (Source: com.au)

"My sense is something will have to give," said analyst Jeffrey Silva. "If [consumers] are using more bandwidth, the question is, who is going to pay for it?"