Netflix is transitioning to the AV1 codec to optimize bandwidth efficiency while expanding its infrastructure to support live events. Concurrently, Amazon has integrated its Luna cloud gaming service into the Prime Video application to diversify its entertainment offerings.
The shift to AV1 provides the technical headroom necessary for Netflix to scale live programming without incurring prohibitive transit costs. As the platform moves beyond asynchronous VOD, efficiency becomes a competitive requirement rather than a luxury, especially when competing for the 43% combined market share held by Netflix and Amazon. This technical pivot mirrors Amazon Prime Video sports rights expansion to increase per-user utility. The broader ecosystem is moving toward centralized hubs that blend gaming, live events, and traditional video. Watch for whether competitors like Disney+ accelerate their own codec transitions to match these efficiency gains during live sports broadcasts.
Netflix's AV1 deployment has reached a significant milestone, with AV1 now powering 30% of Netflix streaming across its global catalog. The company co-founded the Alliance for Open Media in 2015 alongside Google, Intel, and Microsoft to develop the royalty-free codec, and began streaming AV1 to Android phones in early 2020 before expanding to smart TVs, browsers, and Apple devices with M3 and A17 Pro chips in 2023. Netflix has encoded approximately two-thirds of its catalog in AV1, and the company is now actively evaluating the codec for live streaming, where its compression efficiency could help deliver high-quality experiences to tens of millions of concurrent viewers without proportional bandwidth increases.
The broader AV1 ecosystem continues to expand across platforms and device manufacturers. Amazon Prime Video adopted AV1 in 2021, and the codec is now used in Instagram Reels, Microsoft Teams screensharing, and Discord. YouTube launched AV1 for VOD playbacks on desktop browsers in 2018 and expanded to televisions and mobile phones as hardware support became available starting in 2023, with YouTube beginning to deploy software AV1 decode for Android and iOS devices lacking hardware support in 2024. Apple built an AV1 decoder into the iPhone 15 Pro in 2023 and added support across the entire iPhone 16 lineup, while chip makers including Nvidia, AMD, and Intel have launched GPUs with AV1 decode capability.
On the technical side, AV1 delivers approximately 30% better coding efficiency than VP9 and HEVC, and around a 70% bitrate reduction compared to H.264, according to Meta's engineering team, which deployed AV1 for Reels. For live streaming specifically, Netflix's engineering blog notes that AV1's layered coding support in its main profile allows encoding main content in the base layer and graphics overlays in the enhancement layer, which is particularly relevant for live sports streaming with embedded statistics and sponsorships. Work is also underway on AV1's successor, with , though device support for that next-generation codec remains several years away.
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