Netflix loses viewers to the Olympics

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(CNET) The streaming of the Olympic Games may be popular among viewers, but not so much at Netflix.

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Netflix streaming dropped 25 percent in the U.S. on Sunday, according to data from Procera. That was the day that streaming of the London Olympics by TV networks reached a peak as high as 34 percent of all bandwidth. The rate of streaming also jumped by more than 100 percent over the previous two days.

Put two and two together, and Netflix is being hammered by the Olympics, at least in the U.S. Netflix streaming in Canada remained at its usual level.

"This matches expectations," Procera explained, "as the U.S. is much more involved in the Olympics than Canada, and with the peak levels that we mentioned earlier for Olympics streaming, something had to give, and in this case it was Netflix."

In the U.K., streaming on the BBC iPlayer surged 100 percent over typical Sunday levels, with the Games grabbing half of all traffic, according to Procera.

The drop in its own traffic comes as no surprise to Netflix.

At the company's second-quarter earnings call last week, CEO Reed Hastings cautioned that interest in the Games could eat into the number of viewers and even keep new customers from signing up.

But Hastings added that Netflix isn't concerned about the overall effect on subscriber rates, according to Venture Beat. The CEO believes that people immersed in the live streaming of the Games will watch Netflix during off-hours or simply catch up on their viewing after the Games end.

Still, the competition from the Olympics is yet another obstacle for the once-hot video rental service.

The company admitted last week that it might not reach its goal of adding 7 million U.S. subscribers this year. Netflix is also still caught in the never-ending battle between streaming and physical disc rentals. Over the second quarter, the company added 530,000 streaming subscriptions in the U.S. but lost 850,000 subscribers from its DVD rental service.

This article originally appeared on CNET.

  • Lance Whitney On Twitter» On Facebook»

    Journalist, software trainer, and Web developer Lance Whitney writes columns and reviews for CNET, Computer Shopper, Microsoft TechNet, and other technology sites. His first book, "Windows 8 Five Minutes at a Time," was published by Wiley & Sons in November 2012.

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