Netflix Re-encodes Entire Library To Reduce Data Consumption By 20 Percent, Skirt Comcast Data Caps

Netflix is on a mission to re-encode its entire library of movies and TV shows. The ambitious goal is to reduce data consumption by up to 20 percent without a degradation in video performance, and based on internal tests in which Netflix challenged employees to spot the difference between new and old streams, the effort seems to be working.

The challenge was simple. Netflix placed two televisions side by side, each playing the same content except that one was streaming video based on the new bandwidth saving technology. Any employee who could spot a difference would win a bottle of champagne. In the end, the employees gave up, and that was sufficient motivation for Netflix to move full steam ahead.


In order to reduce bandwidth consumption by up to 20 percent, Netflix had to reassess its original approach and admit that it'd been doing things wrong. As originally conceived, Netflix would dole out different versions of the same video to customers based on their bandwidth. Videos would range in bandwidth and resolution from 235kbps and 320x240, respectively, all the way up to 5800kbps and 1920x1080.

The quality of your Netflix experience would depend on your Internet connection, and this approach is also the reason why videos sometimes bounce around in quality as you watch them -- maybe little Johnny fired up a game and temporarily hogged your bandwidth.

One of the things Netflix figured out is that it doesn't make sense to treat each video the same. For example, a live-action movie is pretty complex with lots of movement, whereas animated flicks are far less demanding.

Netflix Puss in Boots

"You shouldn't allocate the same amount of bits for 'My Little Pony' as for 'The Avengers,'" Netflix video algorithms manager Anne Aaron told Variety. Aaron explained that animated shows are comparatively simple with single color backgrounds, like a blue sky, versus complex scenes in action flicks.

"A one-size-fits-all model doesn't give you the most optimal quality," Aaron added.

So that's one way Netflix is reducing bandwidth -- applying different rules to different videos. In doing so, a show like "My Little Pony" can be streamed at 1080p with a bitrate of only 1.5Mbps, whereas previously a customer that could handle that load would only see the show in 720p.

This doesn't just apply to animated movies and shows. Netflix has been doing the same to individual episodes within a single TV series. Some episodes are more intense than others, so that's another area where Netflix can reduce bandwidth.

The timing of this effort comes as Netflix has grown to consume over a third of all Internet traffic -- 37 percent, to be exact. Bandwidth consumption has also been a point of contention between Netflix and ISPs like Comcast. In February of last year, Netflix inked a deal with Comcast in which it would pay the ISP to ensure its feeds reached customers at full speed.

This is all just the beginning. After Netflix is finished re-encoding its entire catalog, it might do the whole process over again by taking a scene-by-scene approach. And then there's 4K video to think about.