Study: Canadian Internet Users Pay Dearly for Netflix Canada Consumption
TORONTO -- Internet subscribers facing “pay-as-you-go” usage limits pay dearly for Netflix bandwith.
That’s the conclusion of the New York branch of investment bank Credit Suisse after a team led by analyst Stanley Wang weighed the impact of video streaming in a Canadian market that already has consumption-based pricing not yet introduced south of the border.
“Not surprisingly, our case study finds that an OTT (over-the-top) service like Netflix can lead to a material increase in broadband data usage - in this case, ~20 GBs of data for the month, or ~1GB per hour of standard definition online viewing,” Wang concluded after testing Netflx Canada for one month over an Internet access account with Rogers Communications, the country’s largest cable operator.
"In turn, based on Rogers Communications' data pricing structure, this would have resulted in a $12 per month increase in broadband for our test home,” the Project Canada study found.
Adding to the cord-cutting debate, the Credit Suisse study predicts Netflix and other web TV platforms will force Canadians to cut their cable TV bills to view bandwith-hogging video online.
"To offset this (Netflix), the household would need to trade down to a lower subscription video package, at the expense of fewer linear channels,” the study stated.
Rogers and other Canadian content carriers reduced their bandwith caps for subscribers as Netflix last year entered the Canadian market with its online video subscription service.
Netflix is expected to roll out its video-streaming service elsewhere internationally going forward.