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State of the Internet amid coronavirus pandemic – S&P Podcast

With the nation in shutdown mode induced by the coronavirus pandemic, in-home media usage has soared, along with increased bandwidth exertion from students and those working remotely.

Despite these pressures, connectivity has remained strong and consumers have expressed interest in adding more streaming services to their entertainment options, speakers said on the latest episode of "MediaTalk," an S&P Global Market Intelligence podcast.

Craig Matsumoto, senior analyst at 451 Research, now part of S&P Global Market Intelligence following its acquisition in December, said he didn't expect all the added usage to break the internet.

It is "really hard to congest the entire internet," especially with a large country like the United States, where there are different possible paths and networks that get you from point A to point B, Matsumoto said. Moreover, the telecom, cable and pure-fiber companies that run the backbone of the Internet are "constantly paranoid about running out of bandwidth. So they try to keep the networks empty 50% overhead is the number that I hear" from a lot of executives, he said.

Since sheltering at home began, internet traffic has risen by about 30%. "If you just compare the two numbers, there was actually enough margin to eat up all the sector traffic," he said.

Matsumoto has been surprised by usage patterns, as he expected "a plateau-like traffic" that would start at 8 a.m., and remain relatively flat throughout the day because "everyone is just watching Netflix and Disney+ all day long before it fell off at like midnight."

As it turns out, "there is a surge in the morning that is higher than it used to be percentage-wise. So the morning peak is closer to the evening peak than it used to be."

John Fletcher, a media analyst at Kagan, a research unit within S&P Global Market Intelligence, pointed to a recent survey that might explain some of that prolonged activity. Despite economic concerns, about 20% of consumers responding to the Kagan survey indicated they are interested in adding on a subscription streaming service.

Hulu LLC topped the list, followed by Netflix Inc., The Walt Disney Co.'s Disney+, Inc.'s Amazon Prime, and then Apple Inc.'s Apple TV +. Fletcher also noted that streaming is a growing medium with "a long tail of other services out there."

The survey was taken before the May 27 bow of Warner Media LLC's HBO Max, which at $14.99 per month is at the high end of streaming services. Still, Fletcher said with many people confined to their couches, it is a good time for the HBO Max launch and with 10,000 hours of content, it ranks among the top 4 streamers, relative to the breadth of its offering.

Fletcher said "hitting the ground running with a huge library of external content worked wonders for Disney. It will be interesting to see what happens with HBO Max."

Speaking of Disney +, Matsumoto said its U.S. launch in November 2019 ran into authentication/sign-up issues. "This tends to be the problem more often than the bandwidth,” he said, noting that often happened when HBO premiered a new episode of its most-watched franchise. "Game of Thrones."

Disney was okay bandwidth-wise, he said as it used multiple content delivery networks, a normal deployment for a big event, like the Super Bowl or Olympics. "In terms of bandwidth they were pretty well-covered; it was their own back-end systems that did them in."

Matsumoto said Disney presumably corrected those issues when it launched Disney + into some European nations and India.

Kagan’s research also extended to ad-supported video services. Fletcher said consumer interest was highest around network TV websites, like and

Crackle Inc. was the second-most popular choice, with 18% of respondents saying they would have interest in sampling the service, while The Roku Channel was third, Facebook Watch fourth and ViacomCBS Inc. entry Pluto, rounded out the top 5 at 14%.

While media usage has grown during the pandemic, so has education, as the virus shuttered schools and colleges around the nation. The jury is still out, though, on what happens if at-home learning becomes the new norm.

Matsumoto said that for those who have good bandwidth and devices, an in-sheltering school system can work. But he cautions that not everybody has those conditions. He also questions whether it's good for younger and/or older kids "to do their learning by staring at a screen for six hours a day. I kind of worry about that."

Additional insights from 451 Research on how network-heavy services cope with coronavirus can be found here.

MediaTalk Podcast · Episode 13 - The State Of The Internet Amid Covid - 19