be when you download a PDF or file directly from a website, which is a very common user activity. HTTP: Plain old HTTP browsing with no security.

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Welcome to the New Phenomena Report I™d like to reintroduce you to the Sandvine Global Internet Phenomena Report! We have worked hard on this edition to bring you a comprehensive view of what is happening on the internet to help the industry as a whole get a reality check on how the hype on speci˜c applications translates to network impact. With the attention of both consumers and network operators focused on network quality, it is more important than ever for operators to understand how their bandwidth is being consumed. This edition of the report will cover both global macro and regional micro views of the composition of traf˜c on the internet. Sandvine™s value proposition to our customers is the accuracy and granularity of our network intelligence, so we focus on identifying as many applications as we can, despite how the internet is becoming more encrypted. Why is this important? When networks get congested (and they always end up congested), the solution to the problem depends on the root cause. That sounds logical, but network operators are limited today by both regulatory issues and a lack of visibility, and are struggling to retain the visibility that they need to make the right network investments that deliver a high quality experience to their subscribers. Different applications require different network resources to achieve good quality, and without accurate visibility into network traf˜c composition, network operators cannot deliver for consumers.The Global Internet Phenomena Report ranks applications based on their fitraf˜c share.fl The fascinating data that fuels the report illustrates the disconnect between fimarket sharefl for companies de˜ned by subscriber counts and how often subscribers use a service. Traf˜c share is de˜ned as the percentage of network resources used by a speci˜c application relative to other applications.For Global and Regional overall reports, we rank all applications that Sandvine can see. For the Spotlight reports, we compare applications of a speci˜c type (streaming video, messaging, etc.) to see which ones lead their categories.Cam Cullen, VP of Marketing, SandvineA word from Lyn Cantor, CEO, Sandvine The new Sandvine is a combination of the former Sandvine and Procera businesses, now fully integrated and aligned as a global leader in the Network Intelligence market segment. Our customer base represents over 150 T1 and T2 global network operators and our solutions touch over 2.1B internet subscribers worldwide. The foundation of our business model is being ‚the best™ telco network data analytics company with use cases that help our customers understand, optimize, and manage subscriber quality of experience (QoE). Fundamentally, our objective is to always provide the best vendor agnostic granularity and accuracy for the data ˚owing across our customers™ networks and help them intelligently act on that data. You will see an ongoing commitment to deliver the pre- eminent view of global trends and distilled insights on what our operator eco-system sees and manages in terms of services delivered to subscribers. As our global reach continues to expand across ˜xed, mobile, cable, satellite, and WiFi network domains, we will bring you viewpoints on the latest trends and ‚special topics™ through our report series. Our goal with this report is to inform the global community on the ‚Internet Phenomena™ we live in every day and to expose both challenges and opportunities to build a more collaborative eco-system, providing a robust connected experience for subscribers. We hope you will enjoy the report as well as the enhanced presentation of the data. If you have any suggestions on how we can make this report better, we would appreciate your input. Please feel free to reach out to phenomena@sandvine.com.Lyn Cantor, CEO, Sandvine About the Global Internet Phenomena DataThe data in this edition of the Global Internet Phenomena Report is drawn from Sandvine™s installed base of over 150 Tier 1 and Tier 2 ˜xed and mobile operators worldwide. The report does not include signi˜cant data from either China or India, but the data represents a portion of Sandvine™s 2.1B subscribers installed base, a statistically signi˜cant segment of the internet population. This edition combines ˜xed and mobile data into a single comprehensive view of internet traf˜c across all network types. A future edition will break out separate ˜xed and mobile traf˜c composition. Within each section, Sandvine measured the global traf˜c share for applications from several different perspectives: Downstream: This is the traf˜c volume downloaded from the internet. Examples would be a video stream, a ˜le download, or an app download from iTunes. Upstream : This is the traf˜c volume uploaded to the internet. It could be requests for content (i.e., browsing the Net˚ix library), an interactive messaging session, or a Twitch stream of a gaming session from a console. Connections: This represents the number of ficonversationsfl occurring for an application. Some applications use a single connection for all traf˜c, others (like Net˚ix, BitTorrent, or Pokemon Go) use many connections to transfer data or video to the end user. Welcome! 2The Global InternetPhenomena ReportOctober 2018Copyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.

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Section 1: Global NewsSection 3: SpotlightsHIGHLIGHTS IN THIS EDITION A brief overview of some of key ˜ndings in this issue of the Global Internet Phenomena Report. EXECUTIVE OVERVIEW What are the phenomena that are dominating the internet in 2018? You can bet the video streaming is one, but which video providers, and what other applications are heating up? GLOBAL APPLICATION TRAFFIC SHARE What application categories are the leading consumers of internet bandwidth? The real question is how much traf˜c on the internet is video? GLOBAL APPLICATION RANKINGS Drilling a bit deeper, what speci˜c applications are internet users engaging with and spending their valuable gigabytes on? The usual suspects are on the lists, but in what order? GLOBAL TRENDS: BEYOND THE TOP 10What happens outside the top 10? With over 5300 signatures present in this Global Internet Phenomena Report, there are bound to be some interesting factoids out there. We look at Nest thermostats, Alexa versus Siri, Ethereum and Bitcoin, as well as some other apps that caught the eye in the data.SPOTLIGHT STREAMING VIDEO Not all regions are created equal when it comes to streaming video traf˜c share. Net˚ix and YouTube are everywhere, but local streaming is increasing. SPOTLIGHT GAMINGWhat individual games are generating the most traf˜c on networks? Since the number of players does not always align with traf˜c share, we look at each region to determine the winners. SPOTLIGHT SOCIAL NETWORKINGFacebook or Instagram? What about Snapchat? Or VK and YouKu? Although the leaders are obvious, there are some surprising names that pop up in this edition.SPOTLIGHT MESSAGINGSkype is the global traf˜c share in messaging, but there are other strong contenders not far behind that may shift the share rankings in the next edition.SPOTLIGHT STREAMING AUDIOfiAnd the winner in streaming audio isSpotify.fl The market share numbers for streaming audio do not align with the traf˜c share, so what services are being used by consumers more often? INFOGRAPHIC COLLECTION AND RESOURCESWant to use some of this data? We have a handy collection of resources to simplify re-use of the data in the Phenomena report, as well as links to more information if you have questions for us. AMERICAS DOWNSTREAM TRAFFIC SHARENet˚ix once again takes the Americas crown, despite improvements in ef˜ciency, video traf˜c management, and increased competition. Who else is in the top 10? AMERICAS UPSTREAM TRAFFIC SHAREVideo is the top upstream source of traf˜c in the Americas Œ how can that be? SPOTLIGHT: CONNECTED FITNESS Ever heard of Peloton? If you run a network, you should check it out. EMEA DOWNSTREAM TRAFFIC SHAREGaming is having major impact on networks in EMEA, with 3 in the top 10. EMEA UPSTREAM TRAFFIC SHARE BitTorrent leads EMEA upstream traf˜c share by a large margin. SPOTLIGHT: WORLD CUP 2018 The 2018 World Cup was a major force on the internet, with impact felt not only with the games themselves streaming online, but also in social networking and other video streaming sites. APAC DOWNSTREAM TRAFFIC SHARE Social networking is a driving force in APAC networking, with Facebook Video leading YouTube. APAC UPSTREAM TRAFFIC SHARE P2P applications besides BitTorrent make an appearance in the Phenomena report in APAC. SPOTLIGHT: GOOGLE How dominant is Google in APAC? It has over 40% of all connections in the region. Section Overview The Global InternetPhenomena ReportOctober 20183Copyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.Section 2: Regional News

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Highlights in this edition The Global InternetPhenomena ReportOctober 20184Copyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.Video is almost of the total downstream volume of traf˜c on the internet 58%isof the total downstream volume of traf˜c across the entire internet 15% of internet traf˜c is encrypted, and TLS 1.3 adoption is growing More than 50%is becoming a signi˜cant force in traf˜c volume as gaming downloads, Twitch streaming, and professional gaming go mainstream GAMING22%31% BITTORRENT is almostof total upstream volume of traf˜c, and over in EMEA aloneAlphabet /applications make up over of the total internet connections in APAC40%Plus spotlights on:Traf˜c share leaders for video, social networking, messaging, audio streaming, and gaming

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HIGHLIGHTS IN THIS EDITIONThe trends driving the internet this year are showing signi˜cant changes from previous years: Ł Video is still dominant with almost 58% of overall downstream traf˜c, despite operators more aggressively managing video traf˜c. Ł Over 50% of traf˜c on the internet is encrypted, and it will continue to grow. The majority of web traf˜c is encrypted, and more applications are leveraging secure connections from end-to-end. Ł Gaming is becoming a signi˜cant contributor to traf˜c. More games are delivering a good mobile experience and are designed with ubiquitous connectivity, capturing more mind share with consumers.Ł File sharing is not dead. With more content choices and channels than ever before, consumers do not have good options to get access to all the content that may interest them and are still resorting to piracy. Ł Live events are beginning to have a noticeable effect on networks. The World Cup and Super Bowl generate spikes in networks worldwide, exceeding YouTube and other video applications.The internet is more diverse than ever Previous Global Internet Phenomena reports highlighted a few applications that dominated the world scene: Net˚ix, YouTube, Facebook, and BitTorrent were the biggest historical traf˜c sources. All of those applications are still big players, but the internet landscape has signi˜cantly diversi˜ed; regional variations are showing up throughout this report, creating a new tenet for network operators that fiall internet trends are local.fl If there is one common theme to this Global Internet Phenomena, it is that the traf˜c on the internet is more encrypted than ever. A conservative estimate of the data shows that over 50% of the traf˜c on the internet is encrypted. Some applications are not always encrypted, and Sandvine did not count these as part of that 50% number. Even with the conservative view, TLS traf˜c has grown (showing a shift to a more secure protocol than SSL). For consumers, this is great Œ their traf˜c has better privacy than ever before. This does not protect them from hacks or data breaches, but at least ensures that their traf˜c cannot be fireadfl by anyone that gets access to network traf˜c, especially with the increasing use of public WiFi connectivity. For network operators, this trend creates a huge challenge. Network operators Œ ˜xed, mobile, WiFi, and even satellite Œ need to understand the composition of traf˜c (not the content) so that they can build out a network capable of meeting a consumer™s quality expectations. With a higher percentage of traf˜c encrypted every day, operators are struggling to gain a holistic view of their networks. We will talk quite a bit about video in this report, but it is important to highlight the diversity of video streaming traf˜c around the world. Although Net˚ix and YouTube are still the largest names in streaming (as you will see in the reports) there is an ever growing number of other streaming providers capturing consumer screen time. This video diversity trend has led directly to the continued relevance of ˜le sharing, which is still a major source of internet traf˜c. Consumers that cannot afford to subscribe to all of the different services turn to ˜le sharing to get the latest content, even as governments attempt to shut down sharing sites. Gaming traf˜c continues to grow. This report has a speci˜c highlight on gaming, which is now the third largest contributor to downstream bandwidth usage. Finally, live events are registering on the fiinternet Richter scale,fl causing major traf˜c spikes during the World Cup and Super Bowl. These traf˜c spikes are truly filocal,fl and they need to be planned for by operators, or else quality of experience (QoE) will suffer for consumers. Executive Overview The Global InternetPhenomena ReportOctober 20185 Over 50% of the traf˜c on the internet is encrypted File sharing is not dead: BitTorrent is #1 in Europe and APAC, and #2 in Americas for upstream bandwidth consumption. #1#1#2Copyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.

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GLOBAL APPLICATION CATEGORY TRAFFIC SHAREVIDEO STREAMING 57.69% 22.43% WEB 17.01% 20.98% GAMING 7.78% 2.68% SOCIAL 5.10% 3.73% MARKETPLACE 4.61% 1.90% FILE SHARING 2.84% 22.05% MESSAGING 1.72% 8.12% SECURITY 1.41% 7.48% STORAGE 1.41% 9.37% AUDIO STREAMING 1.05% 0.46% Video is bigger than ever It is not a surprise that streaming video is the top application type on the internet. If you had asked anyone what category of application they thought would be at the top, video would win by a landslide. What might not have been expected is the gains that other application types have made even while video continues to drive downstream bandwidth usage. Gaming has gained in relevance, and ˜le sharing has experienced a bit of a resurgence. Streaming Video: Streaming video includes not only over-the-top (OTT) video streaming services like Net˚ix, YouTube, and Amazon Prime, but also operator-based streaming and direct consumer streaming. Many operators offer streaming of the content that they own the rights to (DirectTV, Comcast, etc.) as well as just about every network streaming their content in some way. Social network video sharing and direct video connectivity (like FaceTime) are also included. Web: Web traf˜c is the container for all web traf˜c that Sandvine does not attribute to an individual application. This includes web browsing, HTTP downloads, mobile applications that are simply web front ends, or applications that have not been classi˜ed by Sandvine yet that use HTTP as a transport protocol. However, with over 5300 signatures making up the data for this report, that fibucketfl is pretty small. Gaming: Gaming traf˜c includes downloads from major gaming networks (PlayStation Network, Xbox Live, Steam, Nintendo, etc.) as well as traf˜c from speci˜c games. The actual figamingfl traf˜c on the network when downloads are included is likely higher due to marketplace downloads.Social: The largest social networks worldwide (43 for this edition) were uniquely tracked in this report. Marketplace: Includes iTunes, Google Play, and Windows Store, as well as updates for major device types.File Sharing: BitTorrent is the dominant ˜le sharing protocol on the internet, and continues to remain a signi˜cant source of internet traf˜c. Storage: Cloud storage usage is becoming a ubiquitous service for consumers. Dropbox, iCloud, Google Drive, SharePoint, and many others have become an integral part of the mobile experience.Security: This category is a bucket for security network infrastructure traf˜c as well as VPN traf˜c. Messaging: Messaging includes both VoIP as well as chat applications; whether this is an operator delivered voice service, an OTT offering, or a social network offering, consumers use these apps daily. Audio Streaming: Spotify, Apple Music, Google Play Music, and other audio streaming services are included in this category.Global Application Traf˜c Share The Global InternetPhenomena ReportOctober 2018614725836910Almost 58% of downstream traf˜c on the internet is video AMERICAS TOP 5#1#2 #3 #4 #5 EMEA TOP 4#1 #2 #3 #4 APAC TOP 3#1 #2 #3Copyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.

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Nest Thermostat: 55th of all connections at 0.16% 344th of all upload bandwidth at 0.01%HIGHLIGHTS Nest Thermostat: The most signi˜cant IoT device pops up as 55th on the list of connections at .16% and .01% of upload bandwidth. Voice Assistants: Alexa versus Siri is a network dead heat, with each one representing .05% of connections worldwide, and Alexa at 97th and Siri at 102nd.Mobile Advertising: DoubleClick (Google), Flurry, AppsFlyer, Adjust, and AppLovin all made the top 200 applications, showing that advertising is still powering the monetization of a lot of mobile applications. Mobile Crashes: Crashlytics was .32% of all connections (40th worldwide), and it was also .05% of upload traf˜c (137th worldwide) for upstream bandwidth. Cryptocurrency: Bitcoin and Ethereum have been in the news quite a bit lately. They are also growing on the internet. Bitcoin was .02% (224th worldwide) of upstream traf˜c, likely representing Bitcoin miners reporting back to servers. Ethereum was .01% of all connections (277th worldwide), showing it is gaining market momentum.Global Trends: Beyond the Top 10 8The Global InternetPhenomena ReportOctober 2018vsAlexa0.05% of all connections 97th worldwide>0.01% of all Upstream 448th worldwide0.05% of all connections 102nd worldwide0.04% of all Upstream 143rd worldwide Siri0.32% of all connections0.05% of Upstream Bandwidth 0.02% of Upstream Bandwidth 224th worldwideMobile Advertising Applications in Top 200 0.01% of all connections277th worldwideCopyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.

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Net˚ix, anyone?Net˚ix has consistently been at the top of the rankings in the Americas, and that continues with 19.10% of total downstream traf˜c being Net˚ix. The sheer volume of Net˚ix traf˜c in the Americas is what propels it to worldwide leadership. At peak hour on ˜xed networks, this number can spike as high as 40% on some operator networks in the region. Although Net˚ix is at the top, other video services are starting to make an impact. HTTP Media Stream and Raw MPEG-TS represent a generic bucket for other OTT or operator streaming video services, showing diversity outside the top OTT services. Amazon Prime continues to grow their bandwidth share in the Americas, and several other major OTT players sit right outside the top 10 Œ more on that later! YouTube sits ˜fth, and has a much stronger showing on mobile networks than on ˜xed, and since this report has more ˜xed bandwidth than mobile for the Americas, it biases the Americas numbers for the OTT content providers. Gaming makes an appearance, with Xbox Live downloads making up 2.09% of downstream traf˜c, narrowly beating out the PlayStation Network at 1.56% (13th) in the region. Gaming downloads are an increasing amount of downstream, and Twitch is also in this ecosystem.Americas: Downstream Application Traf˜c Share The Global InternetPhenomena ReportOctober 20189AMERICAS TRAFFIC SHARE TOP 10NETFLIX 19.10% HTTP MEDIA STREAM 16.51% RAW MPEG-TS 10.05% AMAZON PRIME 7.74% YOUTUBE 7.53% HTTP (TLS) 4.49% HTTP DOWNLOAD 4.87% HTTP 4.46% XBOX LIVE DOWNLOAD 2.09% QUIC 2.07% 14725836910Net˚ix™s dominance is even more impressive when you examine how they have the best ef˜ciency for video streaming of the major video providers. The top left image shows Net˚ix™s Hot Fuzz at 459MB for a ~2 hour movie. The top right shows iTunes download Œ 4.6GB for 1080, 4.15GB for 720, and 1.86GB for SD. The bottom right shows a few Amazon Prime videos, which range from 579MB for 1hr 29mins to 1.5GB for 2hr 7min. Even with Net˚ix™s ef˜ciency, they are still the leader not only in the Americas, but worldwide. Net˚ix deserves a lot of credit for reducing the throughput needed to stream their services. This means that Net˚ix could easily be 3x their current volume and at 40% of network traf˜c Š all the time. It also bears mentioning that the number of mobile operators managing video traf˜c by offering unlimited viewing for reduced resolutions, which is also depressing the volume of video traf˜c worldwide. Copyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.

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Video on the upstream? We often think of video as a downstream phenomena on networks, but consumers are also sending more video into the internet than ever before. Raw MPEG-TS is the top upstream application, and it is joined by Net˚ix and HTTP media streaming in the top 10. MPEG (video cameras/surveillance) and HTTP media streaming (many different live streaming services) make sense, but why Net˚ix? Net˚ix is constantly fibookmarkingfl your location; as users browse the library, Net˚ix interactively starts video previews, which has had a huge impact on the upstream. This has made video a major player in the upstream, even with social networking video having less impact than expected on networks.File sharing appears on the upstream at #2, but we™ll talk more about ˜le sharing in other regions where it is the dominant force for upstream traf˜c utilization.RTP also pops us, representing a collection of VoIP services using generic VoIP protocols, mainly operator-branded VoIP services (not OTT VoIP). iCloud Photo Stream makes the ˜rst appearance for an Apple product as well as a storage application, illustrating the popularity of mobile photos that immediately get uploaded to the cloud. Photo traf˜c is also part of the Google number from Androids. There are also lots of VPNs in the Americas, as IPSec is 10th on the list at 2.65%, representing both business users and privacy VPN services.Americas: Upstream Application Traf˜c Share 10AMERICAS TRAFFIC SHARE TOP 10RAW MPEG-TS 9.99% BITTORRENT UPLOAD 9.21% NETFLIX 5.13% RTP 4.82% HTTP 4.79% HTTP MEDIA STREAM 3.63% GOOGLE 3.48% HTTP (TLS) 3.20% ICLOUD PHOTO STREAM 3.07% IPSEC VPN 2.65% 14725836910The Global InternetPhenomena ReportOctober 2018UPUPDOWNDOWNNet˚ix user watching video1234Net˚ix updates screen and shows preview User™s sytem sends a bookmark for locationUser moves cursor to new movieCopyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.

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The Global InternetPhenomena ReportOctober 2018Get on your bikes and ride!There is a new fistreamingfl service on the horizon that has the potential to change streaming patterns on networks worldwide. In the US, a new service has achieved cult status, and is rapidly moving into the mainstream as followers pile on behind it. That trend is connected ˜tness. I am not talking about Fitbit-style connected ˜tness, I am talking about filet me workout with a streaming video from a remote classfl connected ˜tness. The pioneer in this space is Peloton, who has one of the highest Net Promoter Scores (NPS) in the market, for their connected bike. The bike comes with a gorgeous 22 in HD display with a resolution of 1080 x 1920 pixels, and all of the video content is streamed in 1080p HD. Peloton streams up to 14 classes a day, and has an ever-changing library of ~4000 on demand classes. Peloton is valued at $4B Œ highlighting the growing popularity of connected ˜tness, and Peloton boasts over one million paying subscribers in the US. Most classes show several thousand participants within the ˜rst week after being recorded, and many continue to get rides for months or even a few years (theme rides are extremely popular Š Jennifer Jacob™s Guns and Roses Ride is highly rated!).Why are we covering them in the Global Internet Phenomena report? In July, during their fiAll For Onefl ride, over 18,000 people joined in live to stream a single workout. Since each stream is an HD stream (~8Mbps and over 800MB of volume), this is a pretty signi˜cant live event on par with other sporting events. For their provider, that was 144Gbps of throughput and ~14.4TB of volume. Since then (as shown in the screenshot), over 56,000 people have streamed that ride, totalling over 45TB of volume. Some riders have taken the ride multiple times, but only their top score is shown and they are only counted once as a participant. With a growing installed base, a connected treadmill on the way, and many competitors following the connected ˜tness craze, operators should keep an eye on connected ˜tness as a trend to watch out for. Global expansion begins with Canada and Europe in the fall of 2018. Americas Spotlight: Connected Fitness11Peloton™s All For One online rideLive:18,000 participants~144Gbps throughput ~14.4TB of volumeOverall:56,000 participants~45TB of volumeCopyright © 2018 Sandvine. All rights reserved. All other trademarks are property of their respective owners.

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