Clever Old Netflix

Pic courtesy of
Pic courtesy of


NETFLIX has been ruling the roost of US streaming for a while and it is fast becoming a major TV provider for UK audiences too. Creating huge cult series, like House Of Cards, and hosting key series, like Mad Men, it is fast becoming a one-stop-shop.  There have been tales of the NETFLIX commissioners crazy investing 100 million dollars into a series without even seeing a pilot, only for it to become a huge hit (House of Cards). But it seems that there is a method behind the mad online genius. According to Mark Sweney of The Guardian the online streaming giant is more on the ball than it would like to let on.

Official Netflix poster for House of Cards
Official NETFLIX poster for House of Cards

NETFLIX spend 3 billion dollars a year on TV and film rights. They spend about 1% of this (still $300 m!!) on creating their own content. While is might seem that NETFLIX candidly throws the odd $100 m on a hunch and get lucky they base these decisions on something much more technical that film scripts and pilots. They base it on data captured from its 44 million worldwide subscribers. Meticulously assessing and analysing international viewing habits gives them a hug advantage over national broadcasters. This is an age-old technique in principle, adapted to a modern, highly complex online world.

Todd Yellin, vice president of product innovation, built this movie-making monster. With one hand it recommends TV shows and films to viewers based on their viewing history, while also furiously recording and feeding back data into NETFLIX programme commissioning mother ship. He explains; “We climb under the hood and get all greasy with alogrithms, numbers and vast amounts of data. Getting to know a user, millions of them, and what they play. If they play one title, what did they play after, before, what did they abandon after five minutes?” Yellin then microanalyses this data to create a TV formula that he knows will work with certain audiences. To some this may sound like a soulless, ratings driven, way of making television, void of craftsmanship and creativity. But Yellin disagrees “It is a beautiful thing being a subscription service… We have nothing to do with advertising, it becomes less about ratings. The days of pure popularity [as a yardstick of success] are over. It leaves the individual quirks and quirks of people’s taste in the dust… User data helps us decide to initially buy the show and to renew it for another season. Traditional networks and cable networks don’t know that stuff.”

So it seems Netflix have found a way to make content that groups of real live people actually like. Have they managed to shake off the shackles of genre and demographic stereotyping? Maybe this will lead us to a more free and more varied viewing experience?

A final word from Todd Yellin  “Is NETFLIX future-proofed? Google isn’t future proofed. No one is. Companies need to keep innovating to secure the future.”