I don't think it's a fear based decision, it would without a doubt reduce their costs considerably.
Netflix runs on AWS and while they are paying a special rate they are still paying through the nose.
Netflix is operating at a loss, has a mountain of debt and it's most profitable when people maintain their yearly sub and binge 1 show ever 2-3 months basically the same way gyms make their money you pay for a year, go for 3 weeks in January a week before easter, few more weeks in late May - June and maybe then a bit after thanksgiving.
Also I asked Netflix chat if this will be applied in the UK they told me yes but also told me 2 interesting things.
1) It will not affect all customers all the time, 2) it's up to 25% bitrate cut.
I have a very strong suspicion that what Netflix is doing is basically a population wide A/B study on how reduction in bitrate will affect viewing habits during a time when people aren't likely to unsubscribe from their service.
This will be quite invaluable to Netflix especially if they'll will find out things like different countries and different user profiles may have different tolerances to lowered bitrates.
I don't care if people would think this is a tin foil hat conspiracy anyone who's thinking that Netflix would not have the data profiling how every user reacts to this change which could allow them to tweak bitrates on a per-user basis in the future hasn't seen any of their talks about just how they use viewer data to tailor their service.
Netflix is not serving streams through AWS. They use AWS for everything except serving streams. They're spending around 15 billion per year on content, bandwidth costs are far lower than that.
This is not how Netflix distributed their content at all. Most ISPs use their open connect system, which places a Netflix box inside their network. Content is streamed from there, which is cheaper for both the ISP and Netflix.
If you subscribe to an ISP of a decent size, then most of Netflix content is served directly from your ISPs network. Netflix has servers at edge locations all over the world. They want to serve as little content as possible from Amazon.
Netflix runs on AWS and while they are paying a special rate they are still paying through the nose.
Netflix is operating at a loss, has a mountain of debt and it's most profitable when people maintain their yearly sub and binge 1 show ever 2-3 months basically the same way gyms make their money you pay for a year, go for 3 weeks in January a week before easter, few more weeks in late May - June and maybe then a bit after thanksgiving.
Also I asked Netflix chat if this will be applied in the UK they told me yes but also told me 2 interesting things.
1) It will not affect all customers all the time, 2) it's up to 25% bitrate cut.
I have a very strong suspicion that what Netflix is doing is basically a population wide A/B study on how reduction in bitrate will affect viewing habits during a time when people aren't likely to unsubscribe from their service.
This will be quite invaluable to Netflix especially if they'll will find out things like different countries and different user profiles may have different tolerances to lowered bitrates.
I don't care if people would think this is a tin foil hat conspiracy anyone who's thinking that Netflix would not have the data profiling how every user reacts to this change which could allow them to tweak bitrates on a per-user basis in the future hasn't seen any of their talks about just how they use viewer data to tailor their service.