Netflix, which leads the OTT video streaming market, is moving aggressively to target the market for live event broadcasts including sports. Its infrastructure capability to support that push has emerged as a key point to watch.

According to a recent Wall Street Journal report, Netflix has broadcast more than 200 live events since March 2023, including weekly WWE (World Wrestling Entertainment) shows. Many events ended without major issues, but some, including the Jake Paul and Mike Tyson boxing match in November 2024, suffered streaming disruptions.

Netflix provides services to more than 300 million subscribers globally, but scaling live broadcasting infrastructure on a large scale has not been easy. The same applies to Amazon and YouTube, which are also strengthening live broadcasts including sports. The Wall Street Journal reported that all of these companies face a difficult situation in delivering bandwidth-heavy large events live over the internet to millions of viewers.

One of the biggest obstacles is that the DNA of the internet network itself is not well suited to that approach.

According to the Wall Street Journal, TV networks such as satellite or cable transmit a channel as a single data stream to all connected receivers. A receiver such as an antenna in a viewer's home takes the signal, and a cable box decodes it. This method is known as multicast. TV operators that run their own closed networks in a given region can design and secure the required capacity in advance for transmission.

When a viewer streams content on Netflix, the viewing device sends a request to a nearby Netflix appliance. That appliance sends a unique viewing session to the device.

For reference, Netflix appliances, known as Open Connect, are dedicated equipment that Netflix has installed in various data centres across countries to deliver content. There are 18,000 units installed across 175 countries. Netflix provides streaming through the Open Connect device located closest to the viewer to account for speed. Even so, when it has to handle many sessions at once, transmission is sometimes not smooth.

Traditional TV broadcasts the same data stream in one batch to all viewers on a reliable closed network. Netflix, by contrast, must deliver as many sessions as there are viewers effectively by competing with heavy traffic moving across the internet.

In the traditional streaming model where viewers select and watch what they want, this was not a big problem. Netflix has preloaded high-demand content onto Open Connect devices and has responded easily to traffic increases.

But that changes with live broadcasts, including sports. Critics say it is not easy to cover with the existing infrastructure structure. Taking that into account, Netflix has also moved aggressively to upgrade infrastructure with live broadcasts in mind. It says it has largely figured out the core technologies needed for live event streaming, though it has been harder than expected.

Netflix currently operates a live operations centre in California. Netflix employees there monitor problems in real time. Netflix plans to establish two additional sites by 2026, one in Britain and one in Asia.

Live broadcasts of large events, including sports, are becoming an increasingly strategic stronghold for Netflix. Live programming is seen as useful not only for expanding its footprint in the $70 billion TV advertising market but also for increasing subscribers. Live broadcasts may also be attractive in providing new viewing experiences different from VOD, such as real-time voting. Considering the circumstances, Netflix is likely to continue strengthening live content. If it secures infrastructure capability to match, Netflix-driven changes in the TV ecosystem could accelerate, and the position of traditional TV networks, already on shaky ground, could weaken rapidly. Nielsen data show YouTube and Netflix already account for about 20 percent of total TV viewing in the United States.