Netflix may represent one of the biggest chunks of peak-period downstream Internet traffic (say that three times fast), BUT they aren't as big as you may think. Or, more accurately, as even the numbers may suggest.
A recent study by bandwidth tracker Sandvine, as reported by TechCrunch, claims that Netflix is number one when it comes to peak downstream traffic in the United States, adding that, "the streaming video service now accounts for 29.7 percent of peak downstream traffic." These numbers are pretty huge, especially considering TechCrunch estimates that web video accounts for 37% of all internet traffic. But here's where the numbers get tricky...or at least contested and put in context.
The notion that "Netflix is the net" was born out of reports claiming the video streaming service accounts for such a large percentage of global bandwidth that it's taking over the Internet "backbone." However, Forbes (and to be fair, TechCrunch does make note of this at the very bottom of their article) wants to clarify the issue and dispel the rumor that "Netflix is eating up a plurality of Internet traffic."
Forbes claims that Netflix actually uses very little of the overall Internet traffic, and instead uses a method that allows them to replicate and cache their content in data centers across North America. What does that mean? By caching their content in local data centers, Netflix is able to reduce its effect on the actual Internet backbone. Bruce Upbin at Forbes says it best: "To clarify, Netflix is small part of overall Internet traffic but a big part of last-mile traffic."
This clarification is an important distinction and serves as an optimistic way to view Netflix's domination of the web. Not only are they minimizing their impact on the "true internet backbone," but they are also able to minimize costs incurred by using these local data centers (with the savings, and quality, hopefully benefiting the customers).
