How COVID-19 is effecting the internet
If it’s not the first, or maybe the only, thing that people are talking about. It certainly will remain the highly contagious, microscopic elephant in the room. We’re talking about COVID-19. But not in the toilet paper-hoarding, I just saw that guy cough without dabbing kind of way. This is a conversation about how COVID is causing quite a bit of flux on the internet.
With mandatory quarantines overseas, shutdowns of “entertainment spaces” and unnecessary congregations, people are stuck inside…and they’re bored. When I was younger and stuck inside that meant things like: pillow forts, board games, maybe a puzzle or two, and trying my best Vince Carter impression on my Nerf basketball hoop before my mom told me I was going to either break that lap, or an ankle. What does a “highly suggested but not actually mandatory (yet)” lockdown mean for me today? Well it means I’m going to spend a heck of a lot more time on the internet. Yeah, I’m surprised too; I didn’t think I could spend any more time browsing the web either. I also didn’t think not going outside since Sunday would be this difficult. But I sat on my balcony and watched the geese on the pond yesterday for about 15 minutes. Yes, exactly like those old people in your neighborhood you would see just sitting in lawn chairs on their driveway watching traffic go by.
I can guarantee you I’m not the only one either. It’s 2020, people are stuck in their homes, and they’re browsing the internet, that shouldn’t come as much of a surprise. I’ll even have some links at the bottom of this post to prove I’m not making this up. Comcast for once in their storied career even played the role of a bit of a nice guy. They cut the price of their lowest internet rate, and even increased the speeds. Reddit, for you boomers out there, is the self-proclaimed “front page of the internet”. Think of it like a newspaper. The big stories that everyone is talking about show up first when you open the website, and then within (called subreddits) you can find topics and articles about pretty much anything. Reddit traffic has increased as much as 50% at peak times since Coronavirus started to keep people inside. This is due to the fact that Reddit can be a large collection of different sources for information on the Coronavirus, but people are also just really wanting to look at pictures of cats on the internet during these trying times as well. Increased traffic means increased ad-revenue, so that’s good for Reddit, what about Netflix? Not so much. Yes more people are consuming more Netflix hours while they “work from home” and Netflix hasn’t run into many issues trying to keep their servers up and running. Which is different than some other platforms, just days into the Pandemic Xbox Live servers had crashed completely, and have ran into more issues since then due to the traffic. And a group of hackers thought this would be a lovely time to disrupt Battle.net (another videogame service) servers, ultimately bringing them down and then causing widespread wait times to access once the servers came back online. So more people are watching Netflix, and their servers are chugging along, so what’s the issue? Well as you know, Netflix is a paid service. And it’s not paid hourly, it’s paid monthly. So people have paid for their February and March subscriptions thus far, and they’re watching away. So if Netflix has about the same amount of subscriptions now as they did in December of last year, but more people are watching Netflix now because they have extra time on their hands, it doesn’t actually mean they are increasing revenue. On the other hand people are having extra time on their hands because many people (some 20% of Americans) have reported cut hours, or actual total job loss, and the issue is far worse overseas. And that is precisely what Netflix is worried about. The chain of events goes something like this: COVID-19 is keeping people indoors. Netflix has to spend more money on their servers because people are watching more frequently, but they aren’t getting any additional money from additional subscriptions. On the other hand COVID-19 is keeping people from traveling. Traveling to places like Europe where tourism generates a whole lot of money for the cities and people living there. Those people have less money 3-6 months from now due to this. And a cancelled Netflix subscription is a very easy way to keep 10-20 bucks a month in your pocket. So Netflix is trying to come up with ways to get people to not cancel their subscriptions. A couple of the theories I’ve come up with would be to create a lower cost option to Netflix similar to some of their competitors. So you take a $5 a month subscription, but then supplement revenue with ads like Hulu does. Or something I would be even more on board with, is if Netflix was able to partner with film companies that are canceling or postponing new movie release dates due to the virus, and instead make brand new movies accessible to watch on Netflix for either a small fee (like a virtual ticket) or simply package that in with the cost options that they currently have more expensive than their competition.
Thanks for reading, I hope you took this post as a neat little tidbit about the lesser-talked about ways everything that is going on is changing our day to day lives. I say that because it is just now that I’m realizing this may come across as just another glum post about Corona.
Here are some links to a couple of articles related to what I talked about if you sided on the interesting tidbit side of things and wanted to read more.