ellneh kaelei amargo
Regenia Junke
I pulled this chapter together from dozens of sources that were at times somewhat contradictory. Facts on the ground change over time and depend who is telling the story and what audience they're addressing. I tried to create as coherent a narrative as I could. If there are any errors I'd be more than happy to fix them. Keep in mind this article is not a technical deep dive. It's a big picture type article. For example, I don't mention the word microservice even once :-)
Given our discussion in the What is Cloud Computing? chapter, you might expect Netflix to serve video using AWS. Press play in a Netflix application and video stored in S3 would be streamed from S3, over the internet, directly to your device.
Another relevant factoid is Netflix is subscription based. Members pay Netflix monthly and can cancel at any time. When you press play to chill on Netflix, it had better work. Unhappy members unsubscribe.
The client is the user interface on any device used to browse and play Netflix videos. It could be an app on your iPhone, a website on your desktop computer, or even an app on your Smart TV. Netflix controls each and every client for each and every device.
Everything that happens before you hit play happens in the backend, which runs in AWS. That includes things like preparing all new incoming video and handling requests from all apps, websites, TVs, and other devices.
In 2007 Netflix introduced their streaming video-on-demand service that allowed subscribers to stream television series and films via the Netflix website on personal computers, or the Netflix software on a variety of supported platforms, including smartphones and tablets, digital media players, video game consoles, and smart TVs.
Netflix succeeded. Netflix certainly executed well, but they were late to the game, and that helped them. By 2007 the internet was fast enough and cheap enough to support streaming video services. That was never the case before. The addition of fast, low-cost mobile bandwidth and the introduction of powerful mobile devices like smart phones and tablets, has made it easier and cheaper for anyone to stream video at any time from anywhere. Timing is everything.
Building out a datacenter is a lot of work. Ordering equipment takes a long time. Installing and getting all the equipment working takes a long time. And as soon they got everything working they would run out of capacity, and the whole process had to start over again.
The long lead times for equipment forced Netflix to adopt what is known as a vertical scaling strategy. Netflix made big programs that ran on big computers. This approach is called building a monolith. One program did everything.
What Netflix was good at was delivering video to their members. Netflix would rather concentrate on getting better at delivering video rather than getting better at building datacenters. Building datacenters was not a competitive advantage for Netflix, delivering video is.
It took more than eight years for Netflix to complete the process of moving from their own datacenters to AWS. During that period Netflix grew its number of streaming customers eightfold. Netflix now runs on several hundred thousand EC2 instances.
The advantage of having three regions is that any one region can fail, and the other regions will step in handle all the members in the failed region. When a region fails, Netflix calls this evacuating a region.
The header image is meant to intrigue you, to draw you into selecting a video. The idea is the more compelling the header image, the more likely you are to watch a video. And the more videos you watch, the less likely you are to unsubscribe from Netflix.
The first thing Netflix does is spend a lot of time validating the video. It looks for digital artifacts, color changes, or missing frames that may have been caused by previous transcoding attempts or data transmission problems.
A pipeline is simply a series of steps data is put through to make it ready for use, much like an assembly line in a factory. More than 70 different pieces of software have a hand in creating every video.
The idea behind a CDN is simple: put video as close as possible to users by spreading computers throughout the world. When a user wants to watch a video, find the nearest computer with the video on it and stream to the device from there.
In 2007, when Netflix debuted its new streaming service, it had 36 million members in 50 countries, watching more than a billion hours of video each month, streaming multiple terabits of content per second.
At the same time, Netflix was also devoting a lot of effort into all the AWS services we talked about earlier. Netflix calls the services in AWS its control plane. Control plane is a telecommunications term identifying the part of the system that controls everything else. In your body, your brain is the control plane; it controls everything else.
In 2011, Netflix realized at its scale it needed a dedicated CDN solution to maximize network efficiency. Video distribution is a core competency for Netflix and could be a huge competitive advantage.
The number of OCAs on a site depends on how reliable Netflix wants the site to be, the amount of Netflix traffic (bandwidth) that is delivered from that site, and the percentage of traffic a site allows to be streamed.
Within a location, a popular video like House of Cards is copied to many different OCAs. The more popular a video, the more servers it will be copied to. Why? If there was only one copy of a very popular video, streaming the video to members would overwhelm the server. As they say, many hands make light work.
Right now, up to 100% of Netflix content is being served from within ISP networks. This reduces costs by relieving internet congestion for ISPs. At the same time, Netflix members experience a high-quality viewing experience. And network performance improves for everyone.
What may not be immediately obvious is that the OCAs are independent of each other. OCAs act as self-sufficient video-serving archipelagos. Members streaming from one OCA are not affected when other OCAs fail.
LinkedIn and 3rd parties use essential and non-essential cookies to provide, secure, analyze and improve our Services, and to show you relevant ads (including professional and job ads) on and off LinkedIn. Learn more in our Cookie Policy.
There are four pillars of reasoning that Netflix is leaning towards that explains their current setback. First, the slowdown in the addressable market directly correlated to connected TVs; it believes this will improve over time. Secondly, it has 222 million paying households, but a further 100 million are benefiting from password sharing and not being monetized. Thirdly, competition is indeed more intense with new entrants from Disney+, Hulu, and HBO Max. And lastly, it refers to macro factors such as geopolitics, namely pulling out of the Russian market altogether, which amounts to nearly 700K users lost due to the political climate surrounding the Ukraine crisis.
So what should Netflix do? Should they change subscription models? Introduce ads? To cut through this, I spoke with Nick Cherrier, Asia-Pacific Chair of the Subscribed Institute, and a recognized expert on pricing and packaging having spent time at Simon Kucher & Partners and at News Corp. Below we went over some lessons that apply to even the broader streaming industry, and really any industry testing new pricing. Spoiler alert: we get into pricing strategies.
Maybe they could have multi-user plans? Perhaps 2, 3, 4 people, families or groups at different price points? You could argue this is already the case. You can create up to five user profiles and depending on your plan (thus price point), have the ability to stream shows across 1, 2, or 4 devices simultaneously for basic, standard and premium respectively. I think the password sharing issue is that the pricing may be off for people using one account across several households. This is what I believe they should, and plan to tackle.
Netflix follows an evergreen model, so the benefits of an annual plan are limited for them if they also offer a monthly plan. You would expect subscribers to simply choose the plan they prefer, and arguably those with a high probability of churning in the short term will opt for the monthly plan regardless.
Alternatively, Netflix could fence a premium offering with additional features behind an annual subscription. This could drive adoption to it and therefore boost retention, but consumers could also react negatively to an attempt to lock them into longer contracts. In the current context, analysts may smell blood in the water.
How about bingeing? I think when Netflix had no competition, bingeing was fine. But now that people have an incentive to swap back and forth between services, I'm not sure dropping all episodes in a season at once makes great sense. I'll sign on for a month and binge some shows and then cancel. Again, this all goes back to better churn management.
Like what you read? You can sign up for the Subscribed Weekly - delivered to your inbox every Saturday - here: and visit , bringing together the brightest minds and renowned experts to keep you informed, educated and inspired about today's growing #SubscriptionEconomy!
Quicken help was no good on this subject. I tried Netflix and they thought Quicken was a streaming app??? Anyway, I want to put ALL my bills in ebiller no matter that I pay myself or they are auto deducted as I need to make a budget. I am new to Quicken for Mac so I assume I have to put in all my bills thru E-billing so I can set up budget - or maybe not? If I can never get these to sync after I try each company to see if anyone even knows what Quicken is maybe I should set them up all as Manual and put in the amount as they are all the same amount every month? If anyone has any ideas on what to do, greatly appreciated.
In order to use E billing you need to either be paying for a Premier subscription to use Quicken's bill pay service, or your bank has to support Direct Connect with Bill Pay (which few banks do). Without E billing, you can still set up scheduled payments on the Bills & Income tab but you'll have to manage them yourself.
90f70e40cf