Netflix Cloud Architecture 1

Netflix Business Strategy 2

Remove Late Fee

Provide Choice from Long Tail

Ubiquitous Anytime access

Incumbents in 1997 ¨  Blockbuster, Hollywood

Videos, Movie Gallery ¤  Rented DVDs out from

prime locations ¤  Kept inventory of about

2000 titles with 3 to 4 copies of each

¤  Mostly expensive DVDs with new movies and some long time hits

¨  New movies typically release to big screen and then release via DVD

¨  DVDs rent while its new ¨  DVD availability window

is relatively small ¨  Charged late fee to

maximize turns

3

Must impose steep rental fees and steeper late fees

The Red Envelope (1999-2008) ¨  Removed late fee as they

saw opportunity in long tail of DVDs

¨  Stocked 120,000 movies mailed out from 50 hubs

¨  Matched renter interest with a low cost movie from the long tail

¨  Announced $1M prize: Help find a better recommendation algorithm

¨  4 years and a team of 10+ PhDs solved that

¨  In 8 years, Blockbuster, Hollywood video et. Al. are almost out of business

4

Recommend movies in the long tail, personalized to the customer, lowering costs

Streaming Movies – 2008 and beyond ¨  Netflix lets users manage their DVD

queue for what they would rent next ¨  Netflix had their own problems

¤  DVD theft ¤  DVD piracy ¤  FBI involved in the US ¤  Could not grow internationally with DVD

renting model

¨  Streaming model looked very appealing ¨  Cost to stream out DVD via CDN was a

few pennies but postage is 10-100 times more

¨  Streaming lets them grow internationally

¨  20M US subscribers ¨  Started streaming to US subscribers

from their datacenter ¨  Datacenter faced cooling issues and

downtime ¨  They issued customer refunds which

directly impacted their bottom line ¨  Netflix at that time was making

about 1.6 billion in revenue and had 400 employees

5

Netflix Decisions 6

¨  Who will manage the streaming backend? ¨  What devices will users watch streaming content on? ¨  On the client end

¤  What should be the client experience?

¤  Should Netflix create their own device?

¤  Should Netflix partner with device makers?

¤  If so, which device makers should Netflix pursue?

¤  What about DRM to prevent piracy and honor IP?

¨  On the cloud end ¤  Who will manage the streaming backend?

¤  Who will maintain and upkeep the data center?

¤  How to deal with data center growth?

7

Take a break from PowerPoint.

Class discusses the case.

On the Client End 8

Decided against creating own device 9

¨  HDMI ports on household TVs were already occupied by a variety of devices

¨  Introducing one more Netflix device wasn’t the best

Partnerships with Device makers 10

¨  Grew subscribers 2008-2010 by partnering with device makers ¤ Game Consoles

n Xbox 360, Wii, PS3

¤ Mobile Devices n Apple iPad, iPhone, iPod Touch, Windows Phone 7 n Android was not in this list until late 2011 (DRM concerns)

On the Cloud End 11

Netflix Cloud Story 12

¨  Circa 2008, Netflix had a single data center ¤ Single point of failure (SPOF) ¤ Approaching the limits on

n Cooling n Power n Physical space n Network traffic capacity

Netflix Cloud Story 13

¨  Strategic choices included: ¤ Build more data centers

n Manage more data centers

¤ Outsource capacity planning and scale out n Focus on core competency

Netflix Cloud Story 14

¨  Winning Choice: ¤ Outsource capacity planning and scale out

n Leverage a leading IAAS provider n  Amazon Web Services

¨  In  two  years,  from  start  of  outsourcing,  Netflix  served  over  90%  traffic  out  of  AWS  

¨  This  excluded  video  streaming  traffic  which  came  from  CDNs  

How Netflix Uses AWS 15

¨  AWS provided various IAAS offering at that time but Netflix apps needed more

•  Data SimpleDB,RDS,S3, EBS

•  Load Handling EC2, EMR, ASG, ELB

•  Monitoring CloudWatch

AWS ?   Netflix apps

Netflix developers filled the gap 16

¨  Netflix developers ported Netflix platform to the AWS

AWS Netflix Platform

Netflix App

Netflix Platform •  Platform.JAR •  Middle-tier Load Balancing •  Discovery •  Encryption Services •  Caching •  Configuration

How Netflix Used AWS 17

ELB

EC2 EC2 EC2 EC2 EC2

EC2 instances for Q EC2 instances for merch

Simple DB S3 SQS

Edge services (such as www)

Netflix mid-tier services (such as Q or merchandizing)

AWS IAAS

?

How Netflix Used AWS 18

ELB

EC2 EC2 EC2 EC2 EC2

Middle Tier Load Balancer and Discovery

EC2 instances for Q EC2 instances for merch

Simple DB S3 SQS

Edge services (such as www)

Netflix mid-tier services (such as Q or merchandizing)

AWS IAAS

Netflix platform

Netflix stack on EC2 19

Netflix Application

Platform and other infrastructure jar files

Guest OS/Virtual Machine/Host OS/Machine

Discovery client

Mid tier load balancer

Crypto Client

S3 client Simple DB client SQS client

Configuration client

Persistent Data: Simple DB 20

¨  Moved large transactional dataset to Simple DB ¤ Rental history info: Everything that any one has watched

on Netflix (including streaming and DVD rentals) ¨  Netflix uses Simple DB to manage

¤ Thousands of domains ¤ Over 1Tera byte of online transaction data ¤ Billions of rows of data

Persistent Storage: S3 21

¨  Simple key-value store organized as objects in buckets ¤  Each AWS account can create multiple buckets ¤  Each bucket can hold unlimited number of objects

¨  Netflix uses S3 to store data that does not fit into Simple DB ¤  Logs from streaming devices ¤  Files used in movie encoding ¤  Truncated tail of rental history

Data Replication: Item Replicator 22

¨  IR: Item Replicator: Netflix homegrown solution ¨  Keeps data in sync between Data Center and Cloud

¤ Replication is mostly unidirectional n Data Center to the Cloud

Netflix Migration to Cloud 23

¨  Netflix case is just one example. ¨  There are several cases of businesses in a variety of

industry that are migrating to the cloud

Questions 24

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