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Australia’s iiNet: “Netflix traffic an issue”

iiNet chief technology officer Mark Dioguardi has admitted that Netflix has caused problems for some customers and revealed it is accounts for 25 per cent of the telco’s total Internet traffic less than a month after its Australian launch.

Before it’s official launch in the country, Netflix made up just 3 per cent of iiNets total downloads, Drioguardi said. That figure rose to 15 per cent after the first week of its launch.

But Netflix usage had exploded since then and was continuing to rise, he told the CommsDay Summit in Sydney. iiNet has suffered from some download problems caused by the service’s huge popularity amongst customers.
The huge increase in data traffic caused by services like Netflix are set to force telcos to change their business models and potentially raise their prices as they move onto the national broadband network.

“We ramped up our core networks a lot – probably doubled it in the last 12 months,” he said. “About 70-80 per cent of our customers are on our own backhaul or dark fibre.

“Of the 1800 [telephone exchanges used by iiNet to reach customers] a couple of dozen run on managed backhaul… and I’d like to drive that down to zero.”

iiNet and Singtel-Optus are both offering quota-free downloads for users streaming Netflix. Dioguardi said the first batch of customers using Netflix free of charge as part of a one-month trial would be forced to choose whether or not to pay for the service starting Thursday.

Once that occurred, he said, the telco would have a better idea of how popular the service would be.

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