Netflix. You may have heard of them. The online streaming service is currently in perpetual ascent, transforming the way the public consume television worldwide – and last week, the trailblazing enterprise announced that it had completed a seven-year transition to the cloud, with all its services now stored via Amazon Web Services or Google archives. Netflix is a company that exists at the forefront of technical innovation, now accounting for 40% of total internet bandwidth at peak times (for context, YouTube and Facebook register 15% and 2.7% respectively). We believe that cloud and innovation go hand in hand. So why has one of the world’s leading innovators decided to place so much faith in cloud?
Netflix first made the decision to move to cloud in 2008 when they suffered a major database corruption. The company was unable to carry out essential services for three days, including the supply of DVDs to customers. To increase the reliability of their servers, the company decided to move crucial away from their own onsite data centres to AWS and Google’s cloud systems. By doing so, they ensure that network downtime is minimised, and therefore the consistency of streaming service for users is conversely maximised. Moreover, they have chosen to invest heavily in the cloud, and have gradually increased their use of it year on year until now, when the transition has been completed. This decision is particularly significant when you consider the nature of Netflix’s business. Many products are supplied via the internet, but Netflix’s product is actually itself within the internet. That makes it doubly important for the company to have reliable networks and in the face of that requirement, the company has chosen to convert wholly to cloud.
In view of this, by making the decision to move to cloud, Netflix set a precedent for the relationship between the cloud and digital-based business. It suggests that the more reliant a business is on the internet, the more cloud has to offer in terms of reliable service and growth support – and since we are firmly in the Digital Age, there is not a business on the planet that can hope to flourish without using the internet to some degree, if only for competitive parity. The cloud’s ability to strengthen the reliability of network connections and offer a more scalable way of accessing data is indispensable to any business. Furthermore, it suggests a clear correlation between cloud and innovation. Netflix are not the only competitor in their market, though they are certainly considered to be the leader by the public – now in a position where their brand name is a natural byword for the service they offer – but the online streaming market itself is an emerging one. It is to be suspected that this young market has only scratched the service of its true potential – so it is a real statement of intent and faith from Netflix to have entrusted this period of product development and commercial growth to the cloud.
By completing their cloud transition, Netflix offer the cloud industry a valuable endorsement as one of the world’s fast-growing, instantly recognisable brands. In embracing online streaming as a branch of their company and converting to cloud to support it, they send out a clear signal that cloud and innovation are a natural fit; that the cloud desktop is the gateway to development for ambitious businesses.