Hello. It's been a little while since this topic was posted, but I'm wondering if you ever found a solution?
Personally, I've been using iCloud backup since it's inception and I've never experienced anything like this problem. However, just a couple of months ago, I started noticing the network drop in the evening. I even switched ISPs because I thought it was their fault. When the problem persisted, eventually I tracked it down to iOS devices backing up to iCloud.
Now that I know what the problem is, I can reproduce it 100% of the time. I will manually start an iCloud backup and within 1 minute, the network slows to an unusable crawl. Sometimes the ping reaches more than 2000 with .01 Mbps download speeds. Within seconds of cancelling the backup, the internet returns to normal. If I don't cancel the backup, iCloud will eventually stop trying to backup, but this can take more than a half hour and the device never backs up.
I've isolated it to iCloud by checking against uploading other large files (10GB+) to my work computer over the internet while concurrently downloading large files back to my computer. There are virtually no slow down issues (none worth noting anyway, as the download speeds might drop a bit, but I'd still able to also stream HD Video from Netflix).
One thing I think is odd is the 1 minute delay before the issue starts. Clearly the iCloud backup starts, it will even give me a reasonable estimated time it'll take. But just before the minute mark, that number ticks up and that's when all other internet usage fizzles out. It makes me wonder what's happening in the background when that begins.
It seems the issue is exclusive to iCloud. I can reproduce the issue wth multiple iPads and iPhones, each with their own iCloud accounts. I've tried multiple routers (and multiple ISPs!) but the issue persists. As I said, this issue only started for the first time just a couple of months ago, so I don't believe that this is expected behavior from iOS or iCloud. But I can't isolate the issue to anything on my network, so I'm starting to suspect it's an issue with iCloud. But if that's the case, why hasn't it been more reported upon?
Any help or suggestions are greatly appreciated.