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Companies Cut Employee Access to Streaming Websites

Corporate network congestion is prompting Internet restrictions


As streaming video and music services proliferate on the Internet, Corporate America finds its networks increasingly clogged by employees watching movies, sports, goofball videos and listening to music online. The response is predictable enough: Companies are moving to block streaming sites in an effort to keep employees concentrated on work and reduce traffic across their networks.

According to USA Today, some of the country’s biggest names — including Kraft (NYSE:KFT), General Electric (NYSE:GE), and Cintas (NASDAQ:CTAS) —  have restricted access to popular streaming websites. The Cincinnati Enquirer noted that venerable consumer product giant Procter & Gamble (NYSE:PG) recently shut off access to Netflix (NASDAQ:NFLX) and music service Pandora (NYSE:P) from its company network.

P&G took action after its IT department linked network slowdowns to employees watching an average of 50,000 online videos and listening to 4,000 hours of streamed music every day. Company executives circulated a memo warning that such streaming consumed a quarter of its bandwidth, the Cincinnati Enquirer reported. The memo also noted that bandwidth usage spiked sharply during popular sports events like the World Cup.

Even technology firms are getting in on the act. IT recruiter Modis cut off employee access to Netflix, Pandora and Google’s (NASDAQ:GOOG) YouTube over bandwidth concerns. “Clients say they keep adding servers and still don’t have enough (bandwidth),” Modis President Jack Cullen told USA Today, adding, “People leave Pandora open and don’t even think about it.”

USA Today noted that the problem of employee Internet abuse had been exacerbated by the spread of mobile computing devices. “There are more devices, more apps and more sites. And companies have to come up with policy on the fly,” Andrew Rubin, CEO of Cymtec, told USA Today. “It’s a decision you make. Three days later, it’s a whole new landscape.”

But not everyone agrees with restricting website access. John Challenger, CEO of consulting firm, Challenger, Gray and Christmas, told New Jersey’s Star-Ledger that, while streaming videos of things like NCAA basketball championship games may eat up bandwidth and slow networks, giving workers a diversion could have business benefits. “It is equally important for employers to cut workers some slack, particularly in an economy that has left many workplaces understaffed and overworked,” he said.

P&G’s experience points up another issue facing companies. Many social networking websites like Facebook now incorporate streaming video and audio, but are also critical components of corporate marketing strategies, especially those targeting younger consumers. P&G did not block access to these sites, the Cincinnati Enquirer said.

Article printed from InvestorPlace Media,

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