Netflix is exploring the potential of generative AI in content creation, believing it can enhance storytelling rather than reduce costs. Co-CEOs Ted Sarandos and Greg Peters highlighted during an earnings call that audiences are more interested in the quality of storytelling than the technology or budgets behind it. Sarandos compared the shift to generative AI to the transition from hand-drawn to CG animation, which improved animation rather than making it cheaper. Netflix's approach to AI is focused on using it as a tool to support creators, not replace them, ensuring that the stories remain engaging and high-quality.

nHow could generative AI impact content creation at Netflix?

Generative AI could provide new tools for creators to enhance storytelling and produce higher quality content. Netflix sees AI as a way to improve its Recommendations and Discovery systems, making it easier for viewers to find content that resonates with them while maintaining a focus on the quality of the stories being told.

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In recent years, the use of AI in entertainment has raised concerns among animators, who fear job displacement and unauthorized use of their work to train AI models. Netflix's position is that quality storytelling remains paramount, and AI should be used to augment, not replace, human creativity. The company's recent Q2 earnings report showed an increase in subscribers and revenue, reaffirming its strong market position and strategic approach to content delivery.