It already makes up more than 60pc of global Internet traffic but the boom in video streaming is just getting started.
Since Netflix began streaming films and TV shows in 2007 it has morphed into a colossus, forking out $12 billion on new content this year to delight over 158 million subscribers worldwide who gorge on its shows.
With others including the BBC, Amazon Prime Video, Apple TV Plus, WarnerMedia and Disney Plus – which signed up 10m users within a day of its launch – getting in on the act, many believe streaming is the future of entertainment.
“It’s a whole new world,” Netflix chief executive Reed Hastings told an audience at the Royal Television Society in Cambridge.
In the UK alone, new market entrants are expected to add 2m subscribers by 2023, according to Ofcom, while globally the market is anticipated to reach a $124.6bn value by 2025 as revenues climb up from $24.8bn this year.
But all this growth comes at a cost, amid growing questions over the environmental impact.
In total digital technologies now emit 4pc of global greenhouse gas emissions, and its energy consumption is increasing by 9pc a year, according to a report published earlier this year by The Shift, a French think-tank.
It claimed that last year online video streaming generated about as much greenhouse gas as Spain emits annually – a significant 1pc of total global emissions, or more than 300m tonnes of carbon dioxide.
The porn industry alone, which makes up 27pc of all online video traffic globally, generates as much carbon as all of the households in France: 80m tonnes.
Netflix accounts for 12.6pc of all Internet traffic volume, according to a September report from Sandvine, a network equipment firm. Another recent study indicated that Netflix’s worldwide user base streams 164.8m hours of content per day.
Since 2018, an estimated average use time of 1 hour and 11 minutes on the service has almost doubled, with Netflix’s vice president of original content claiming in March that the average user spends two hours per day streaming. That growing traffic is not just made of binary digits in a virtual ether, but rooted in physical infrastructure that relies on energy.
It said the environmental spillover of streaming by spelling out the fact that “online video is not a dematerialised use”.
Beyond the television sets and remotes we use to choose our next binge-watch, streaming is dependent on data centres that transfer online video via vast physical infrastructure set-ups involving optical fibre, modems and radio access networks, which in turn requires electricity production – a process that inevitably leads to carbon emissions. “The whole carbon impact of these technologies, you and I are not able to understand where this impact comes from because it’s behind a screen,” says Maxime Efoui-Hess, lead author on The Shift Project’s report. “If you consider video streaming as an entirely virtual usage – it’s actually not.”
“The greenhouse gas emissions of video on demand services are equivalent to those of a country like Chile,” says Efoui-Hess. “The overconsumption of digital technology is mainly comprised of videos.”
Streaming video is not the only issue to contend with. As the gaming industry looks to transcend the physical limitations of consoles, it has turned its hand to cloud gaming, which aims to stream data-heavy games to users on demand over the internet.
Earlier this week, Google launched its Stadia gaming service as it looks to make its mark on a £140bn industry. Microsoft has a similar project in the works, known as xCloud. According to Cisco, a telecoms firm, internet gaming traffic is due to grow ninefold between 2017 and 2022. In energy terms, our future streaming world paints a bleak picture.
So do those extra hours of binge-watching Disney or Netflix’s latest original show, or getting a daily dose of a game require a rethink? Should our relationship with streaming be an abstemious one?
Not if there’s a technological solution to make streaming less carbon-intensive, which is why some people are pointing their attention at ways of making the packets of data streaming onto people’s screens more energy efficient.
Take iSize Technologies, an artificial intelligence firm based in London hoping to downsize and compress video files so that they don’t consume so much energy. In an age of 4K, high definition video in particular, the giant size of video files makes them a prime culprit for energy sapping.
“We are building machine learning to learn how to reprocess or recode the content in order to optimise the delivery in a perceptual manner,” says Sergio Grce, chief executive of the start-up.
What that means is iSize’s technology can compress video files by up to 70pc more than current technology allows, while boosting the transmission of video. The “perceptual” element has been a critical one for Grce, who believes video quality doesn’t have to be compromised by making videos smaller.
The solution has wooed a number of streaming firms, with iSize reportedly being in talks with a handful to trial its technology. “I think being green will play a very important role in us being brought to the market by some of these big partners,” Grce says.
Others see the requirement of a more top-down approach. Dustin Benton, policy director at Green Alliance, a think tank, recognises that people are “frequently” tuning in to watch something online, and that won’t stop anytime soon. It’s why he thinks the area to target, then, is the source of energy itself.
Current electricity production methods require the burning of fossil fuels, but a switch to a cleaner source of energy, such as wind or solar, can alleviate some of the energy burden of streaming.
“First, the companies should set net zero carbon targets and ensure they buy 100pc clean energy. Second, companies need to design their server hardware for reuse and very high recyclability,” he says.
The likes of Amazon, which runs its Amazon Prime Video service, has shown signs of adopting cleaner energy, after unveiling two solar projects in the US last month and a wind project in Scotland. But far more will need to be done to reduce emissions.
But for Efoui-Hess, the implications of ushering in a streaming generation of streamers has not yet been fully understood, as he sees the opportunity costs of streaming, due to its energy demands, being greater than they might seem.
“If we stream more video and more video games, we are going to consume resources which we won’t be able to consume for other things,” he says. “We are in a limited physical world just by the law of physics and so there is limits on the energy and resources we can extract.”
The reality is that the price of streaming is more than just the monthly subscription fees people will find themselves paying more in the foreseeable future. The question then, as Efoui-Hess notes, is not whether we should stream, but at what cost are we willing to.
“We have to keep in mind that nothing’s free. Not even virtual uses.”