Netflix talks openly about how it uses AWS to support its streaming platform, but how much Netflix spends on AWS has always been a secret. Until now.
The thing is, every company that uses AWS and other cloud services has something called a cloud footprint. For Netflix to work, packets of data must traverse data centers, dns servers, content delivery networks, and other public cloud infrastructure.
At Intricately, we monitor the journey and volume of these packets to determine a) which cloud services a company uses and b) how much they’re being used. With this information, we can estimate a company’s “cloud spend.”
Let’s take a look at Netflix’s cloud spend.
Based on Netflix’s utilization of AWS, we estimate that Netflix spends around $9.6 million per month on AWS. And with the free version of Intricately, we can see how this money is allocated across different AWS products.
Like many companies that use AWS, Netflix spends the most on Amazon EC2 ($3 million/mo) and much less on AWS Elastic Load Balancer, Amazon CloudFront, and other AWS products. Intricately also shows us that Netflix spends $1 million/mo or more on Microsoft Azure, Heroku, and Akamai.
Here’s why cloud spend data matters:
Cloud spend data helps marketers at cloud-based companies qualify the right leads. Marketers can see how much a lead is spending on a competitor, how much a lead is spending on cloud technology in total, and how much a lead is spending on a certain cloud category (hosting, CDN, security, etc).
A marketer using Intricately will often enrich their accounts with the following data:
Unlike firmographic data, this data provides more insight into a lead’s propensity to buy. And by qualifying leads based on cloud spend rather than employee count and annual revenue, you can dramatically increase your company’s lead-to-sale conversion rate.
You can view and export this data for Netflix and any other company with the free version of Intricately today.
Netflix's AWS costs were estimated at $9.6 million per month in 2019, according to several sources. Back then, Netflix revealed it would spend over $1 billion on “streaming services and cloud computing costs” through 2023. Netflix would spend $27.78 million per month on AWS cloud services, according to that plan.
Netflix uses AWS for nearly all its computing and storage needs, including databases, analytics, recommendation engines, video transcoding, and more—hundreds of functions that in total use more than 100,000 server instances on AWS.
AWS pricing varies based on the size of the organization. For an enterprise with a headcount of 200, the expected cost range is between $907,900 and $1,325,100. Larger enterprises with a headcount of 1,000 can anticipate costs within the range of $2,717,100 and $6,384,300.
Netflix would rather concentrate on getting better at delivering video rather than getting better at building data centres. In August 2008, Netflix experienced major database corruption for three days. This is when Netflix decided to go to Amazon Web Services (AWS), even though Amazon is its biggest competitor.
Netflix's AWS costs were estimated at $9.6 million per month in 2019, according to several sources. Back then, Netflix revealed it would spend over $1 billion on “streaming services and cloud computing costs” through 2023. Netflix would spend $27.78 million per month on AWS cloud services, according to that plan.
Disney's vast content library, including movies, TV shows, and streaming services, requires a scalable and flexible infrastructure to handle the ever increasing demand. By leveraging AWS cloud services, Disney can dynamically scale its resources based on traffic patterns, ensuring a seamless experience for its users.
Netflix has spent billions of dollars to license hit shows like Grey's Anatomy, How I Met Your Mother, and Seinfeld, as studios gave up on beating the streaming leader and instead decided to play nice by renting their vast libraries of content to it.
The union of Netflix and AWS stems from a strategic shift – moving away from vulnerable, vertically scaled systems in their data centers (like relational databases), Netflix decided to move towards the robust, horizontally scalable, and distributed systems offered by the Cloud.
In a February job posting in 2019, Apple itself stated that the company was looking for someone to lead and architect their growing AWS footprint. By the end of March 2019, Apple's spending on AWS was on track to average more than $30 million a month.
Hulu is redefining the television experience for viewers by using AWS to support the addition of more than 50 live channels for its Hulu with Live TV offering.
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That's especially appealing to companies wanting to keep at least some of their data and applications at their own facilities, rather than in the hands of cloud giants, which are at times their competitors—one reason why Walmart has avoided using AWS and has suggested its vendors do the same.
Over 90% of Fortune 100 and most Fortune 500 companies use AWS Partner solutions and services in their business. Almost every firm, from healthcare to leading streaming service providers, uses Amazon's unique solutions to power its operations and establish its foundation.
As the first entrant into the cloud market, AWS had the advantage of being able to snap up major, data-heavy customers such as Netflix and AirBnB. And with adoption comes inertia: Once companies had decided to use AWS, they were slow to consider moving to a competitor.
AWS accounts for 17% of Amazon's $143,313 billion in overall revenue. Cloud is also a reliable source of profit for Amazon, thanks to high software margins.
Introduction: My name is Mr. See Jast, I am a open, jolly, gorgeous, courageous, inexpensive, friendly, homely person who loves writing and wants to share my knowledge and understanding with you.
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