Every second you watch Netflix, something extraordinary is happening behind the scenes.
Your device is receiving a video stream that was encoded specifically for your screen size, your network bandwidth, and even the complexity of the scene you're watching. A dark, dialogue-heavy scene gets fewer bits. An action sequence with rapid motion gets more. And all of this happens across a global infrastructure spanning thousands of servers in over 190 countries.
This isn't magic. It's engineering. And it's some of the most elegant system design I've ever studied.
The Scale of the Problem
Netflix accounts for roughly 15% of all downstream internet traffic worldwide. During peak hours, that number climbs higher. They serve over 230 million subscribers across virtually every country on Earth, and each subscriber expects instant playback with zero buffering.
To make this work, Netflix has to solve three impossibly hard problems simultaneously:
- Encode every piece of content in dozens of formats and quality levels
- Distribute that content to servers close to every user on Earth
- Adapt in real-time to each user's changing network conditions
Let's break down how they do it.
Shot-Based Encoding: Netflix's Secret Weapon
Traditional video encoding applies a uniform bitrate to an entire video. A static conversation gets the same bits-per-second as an explosion. This is massively wasteful.
Netflix invented shot-based encoding (also called per-shot encoding), and it changed the industry.
Here's how it works:
Step 1: Scene Detection
Netflix's pipeline first analyzes the entire video and detects "shots" — segments where the visual content is relatively consistent. A two-person dialogue scene is one shot. A car chase is another.
Step 2: Complexity Analysis
Each shot is analyzed for visual complexity:
- Low complexity: Still frames, dark scenes, talking heads → needs fewer bits
- High complexity: Fast motion, particle effects, detailed textures → needs more bits
Step 3: Per-Shot Encoding
Each shot is encoded independently at the optimal bitrate for its complexity level. The results are stitched together seamlessly.
The result? Netflix can deliver the same visual quality at 20% fewer bits compared to traditional encoding. At their scale, that's petabytes of bandwidth saved daily and a meaningfully better experience for users on slow connections.
1Traditional Encoding:
2[Scene 1: Dialog] 5 Mbps → [Scene 2: Action] 5 Mbps → [Scene 3: Dark] 5 Mbps
3
4Shot-Based Encoding:
5[Scene 1: Dialog] 2 Mbps → [Scene 2: Action] 8 Mbps → [Scene 3: Dark] 1 Mbps
6
7Same average. Dramatically better quality where it matters.
The Encoding Pipeline at Scale
Netflix doesn't encode content once. For a single movie, they generate hundreds of encoded versions:
- Multiple resolutions (240p to 4K)
- Multiple bitrates per resolution
- Multiple codecs (H.264, H.265/HEVC, VP9, AV1)
- Multiple audio formats (Stereo, 5.1, Dolby Atmos)
- Subtitles in 30+ languages
A single title might have 1,200+ encoded files. Multiply that by their library of thousands of titles, and you understand why Netflix's encoding infrastructure is one of the largest computing workloads on the planet.
This encoding happens on a massive distributed computing cluster. Netflix open-sourced their workflow orchestration tool (Conductor) because the existing tools couldn't handle the scale and complexity of their encoding pipelines.
Open Connect: Netflix's Private CDN
Most companies use third-party CDNs (CloudFront, Akamai, Cloudflare). Netflix built their own: Open Connect.
Here's why: when you account for 15% of internet traffic, using a shared CDN is both expensive and insufficient. You need infrastructure purpose-built for your workload.
Open Connect consists of Open Connect Appliances (OCAs) — Netflix-designed servers placed directly inside ISP networks around the world. When you press play:
11. Netflix's control plane determines your closest OCA
22. Your device connects directly to the OCA
33. Video streams from a server physically inside your ISP's network
44. Traffic never crosses the public internet
This is why Netflix rarely buffers even during peak hours. The video data is already sitting in a server at your ISP's data center, often just a few network hops away.
Pre-positioning Content
During off-peak hours (typically 2-6 AM local time), Netflix pushes content to OCAs based on predicted demand. Their recommendation algorithm doesn't just personalize what you see — it feeds into the CDN pre-positioning system.
If the algorithm predicts that a new release will be popular in São Paulo, the content is already on OCAs inside Brazilian ISPs before the first user presses play.
Adaptive Bitrate Streaming
Even with content pre-positioned nearby, network conditions fluctuate. Netflix uses adaptive bitrate streaming (ABR) to handle this seamlessly.
The client-side player continuously monitors:
- Available bandwidth
- Buffer level
- Device capabilities
- Network type (WiFi vs. cellular)
Based on these signals, it dynamically switches between quality levels mid-stream:
1Network strong → Playing 4K (15 Mbps)
2WiFi drops briefly → Seamlessly drops to 1080p (5 Mbps)
3Network recovers → Gradually returns to 4K
The key word is "seamlessly." Netflix's ABR algorithm is optimized to avoid visible quality oscillation. It prefers staying at a lower quality briefly rather than rapidly switching between high and low, which users perceive as more annoying than consistent lower quality.
Multi-Region Availability: Surviving Data Center Failures
Netflix runs on AWS across multiple regions (US-East, US-West, EU-West, etc.). Their architecture is designed so that any single region can fail completely without users noticing.
This is achieved through:
Active-Active Architecture
All regions serve traffic simultaneously. There's no "primary" region. If US-East goes down, traffic automatically routes to US-West.
Chaos Engineering
Netflix invented Chaos Monkey — a tool that randomly terminates production instances to ensure the system can handle failures. They later expanded this to Chaos Kong, which simulates the failure of an entire AWS region.
When Netflix says they can survive a region failure, they mean they've literally tested it in production, during peak hours, repeatedly.
Stateless Services
Netflix services are designed to be stateless. Any instance can handle any request. This makes routing traffic between regions trivial — there's no sticky session or local state to worry about.
The Numbers That Make It Real
- Encoding: Thousands of encoding jobs running simultaneously on cloud infrastructure
- Storage: Petabytes of encoded content across the Open Connect network
- Bandwidth: Netflix delivers terabits per second of video globally
- Latency: Time from "press play" to "first frame" is optimized to under 2 seconds
- Availability: 99.99%+ uptime, even during massive content launches
What Engineers Can Learn from Netflix
Netflix's architecture teaches principles that apply far beyond video streaming:
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Optimize for your specific workload. Generic solutions (shared CDNs, uniform encoding) work for most companies. When you're 15% of internet traffic, you need purpose-built infrastructure.
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Push data close to consumers. Whether it's a CDN edge server or a Redis cache, reducing the distance between data and users is almost always worth the complexity.
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Design for failure, then prove it. Chaos engineering isn't optional at scale. If you haven't tested a failure mode, assume your system can't handle it.
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Invest in adaptive systems. Static configurations break. Systems that continuously adapt to changing conditions (network quality, load, demand) are fundamentally more resilient.
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Encode once, serve forever. The upfront investment in per-shot encoding pays dividends every time that content is streamed. Front-load computational cost when possible.
Netflix's streaming infrastructure is one of the great engineering achievements of our time. Not because any single component is revolutionary, but because the entire system works together so seamlessly that 230 million users never have to think about it.
That's the highest compliment you can pay to infrastructure: it's invisible.
This deep dive synthesizes public information from Netflix's Tech Blog, their Open Connect program documentation, and engineering talks on shot-based encoding, Conductor workflow orchestration, and chaos engineering practices.