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Netflix’s use of Artificial Intelligence Algorithms

  • Vrinda Mathur
  • Mar 15, 2023
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Netflix, the world's most popular online streaming service, is thriving, with 200 global subscribers. But, have you ever wondered what the reason for such phenomenal success could be? 


According to experts, the main reason is that Netflix uses ML, data science, and AI tools to provide maximum user satisfaction. In fact, anyone interested in working in technology for Netflix or other similar platforms should have AI certification as well as extensive training. As a result, you can assist the streaming service in staying ahead of the competition.


Furthermore, many universities provide AI, data science, and machine learning certificates online through specially designed programs. So, let us proceed to learn more about these technologies and how Netflix uses them. 


Introduction to Netflix:


Netflix is a company that provides online video streaming and video-on-demand services in the United States of America. It was founded in 1997 and is headquartered in Los Gatos, California. It began as a DVD distributor. Customers were receiving DVDs via email from their sales form (DVD Emailing). 


Netflix distributed the 1,000,000,000th DVD on February 25, 2007. In addition, Netflix reinvented its entire business that year. Despite their successful DVD emailing, they realized that it would be supplanted by video streaming over the internet sooner or later, so they decided to innovate.


Netflix is the world's largest OTT service, founded on August 29, 1997, in California by Reed Hastings and Marc Randolph. Netflix is the streaming king of the world, dominating entire online streaming services with penetration in over 190 countries and over 195 million paid memberships. Netflix began as a mail-order DVD rental service before expanding into a streaming service in 2007. People are now aware of Netflix as a streaming service.


Netflix offers a wide variety of content from various cultures and languages. Netflix is accessible via nearly every internet-capable device, including televisions, video gaming consoles, tablets, computers, internet browsers, smartphones, and media streaming devices.


Netflix has made no secret of its desire to take over Hollywood. The company has already stated that it plans to spend up to $8 billion on content this year. Despite all of the awards House of Cards and Icarus have received, one of the reasons Netflix has experienced such rapid success is its streaming technology. That's an area it's been honing in-house since 2010 when it expanded beyond a simple mail-order DVD rental service.


For Netflix, technology is as important as storytelling. No matter how many shows or movies Netflix produces, it must ensure that its 118 million subscribers can watch them without interruption – regardless of where they are in the world, what smartphone they own, or how fast their internet is. 


Netflix recently re-encoded its entire catalog (reportedly around 6,000 titles) to produce the best possible picture while using the least amount of bandwidth, which was made possible by an AI technology called Dynamic Optimizer that it developed.


Also Read | Using Data Handling and Digital Marketing to maximize customer experience: A Netflix Case Study


Technology Behind Netflix 


Since its failure in 2008, when one of its data centers failed and shut down the entire service, causing DVD shipments to halt for three days, Netflix has made numerous changes to its technology stack.


AI is a technological advancement that has many sub-branches that specialize in different tasks. In general, AI relies on the history of algorithmic data to train itself to work efficiently and understand the needs of users. It employs tools such as NLP to provide users with a human-like interaction.


Machine learning is a sub-discipline of artificial intelligence. Machine learning is the understanding of computer algorithms that automatically improve their workings when fed data and experience. In fact, most of these technologies don't even require human intervention to complete their tasks. An artificial intelligence certification can help you better understand the underlying technology.


Next, data science is the process of extracting valuable data from a pool of available information. Users' inputs are used in data science to separate needed insights from clusters of unnecessary data. 


As a result, data science experts can provide organization-specific information, allowing the company to make better business decisions. A robust data science certification program can help you learn the intricacies of the data science space.

 AI used behind Netflix 1. Personalized Movie Selection 2. Create Personalized Thumbnail 3. Pre- Production Locations for Movies 4. Provides High quality streaming

AI used Behind Netflix


  1. Personalized Movie Suggestions:


Not every user wants to watch what other people want to watch, and this is where Netflix excels over other streaming services. It provides users with personalized movie suggestions. To accomplish this, Netflix employs ML/AI/Data to analyze a specific user's watch history and compare it to the movie preferences of others with similar movie tastes. As a result, Netflix has the best selection of shows and movies that you might enjoy watching. As a result, you will receive engaging content.


  1. Create Personalized Thumbnails and Artwork Automatically:


Netflix examines hundreds of video frames from existing movies to determine the most appealing image for its thumbnail. Essentially, it intends to display such thumbnails on its movie recommendations in order to entice you to watch the show. As a result, Netflix increases the likelihood of people clicking on the movie options more frequently.


The calculations of what you may find clickable here are based on the clicking rates of other users with similar interests. You may have noticed a pattern in the thumbnails of the same show or movie. That's Netflix experimenting with users to see which image works best for a specific audience.


  1. Pre-production Locations for Movies:


Every film or television show requires a suitable shooting location. Netflix uses machine learning to find the best shooting locations for specific movies or shows. Furthermore, the Netflix tech team checks the schedules and costs of cast and crew members using ML and data science. 


They can also determine other critical shooting requirements. For example, the likelihood of obtaining a shooting permit, the weather at the location, and other relevant factors.


  1. Provides high-quality streaming:


Netflix can use previous viewing data to determine bandwidth usage and when it can cache location-based servers. As a result, it enables faster loading times and reduces the occurrences of frequent buffering. In fact, most people do not want to continue paying for streaming services that do not provide them with continuous streaming. 


Furthermore, it can degrade the user experience and cause them to never use the service again. The Netflix technical team is well aware of the problem. As a result, they actively implement AI/ML tools to address issues like this.


Machine learning allows tech experts to monitor subscribers' activities and platform usage in real-time. Furthermore, the system predicts user viewing patterns to determine peak platform usage hours. They can also determine when the viewership is low. The obtained data is then used to cache local servers near the viewers. 


As a result, it ensures that viewers do not experience any buffering issues and may reduce its frequency. However, you can learn what lies behind all of this by enrolling in a reputable AI certification program. If you want to join the tech team at platforms like Netflix, you should also pursue data science certification.


Also Read | How has Artificial Intelligence changed our daily lives?


Algorithms of Netflix


Netflix's recommendation system is built using two different algorithms:


  1. Collaborative filtering: 


This filtering assumes that if two users have similar rating histories, they will behave similarly in the future. Consider the following scenario: there are two people. One person enjoyed the film and gave it a high rating. There is a good chance that the other person will follow a similar pattern and do the same thing that the first person did.


  1. Content-based filtering: 


The idea is to filter videos that are similar to those that a user has previously liked. Content-based filtering is heavily reliant on product information such as movie title, release year, actors, and genre. To implement this filtering, it is necessary to know the information describing each item, as well as some sort of user profile describing what the user likes.


Netflix is currently one of the world's most popular online media service providers and production companies. What began about 20 years ago as a small subscription-based DVD provider has now evolved into a company that has revolutionized online media streaming as we know it today. One of the reasons Netflix is an interesting company to discuss is that they are regarded as a role model for modern cloud-based companies due to its use of Microservices architecture.


Netflix was one of the first companies to successfully transition from a traditional monolithic architecture to a cloud-based microservices architecture. In fact, Netflix used this architecture long before the term "microservices" was coined. It took Netflix more than two years to complete its cloud migration. Netflix not only perfected the use of microservices, but it also managed to open source many of the tools used to build it. The Netflix OSS (Open Source Software Center) contains a wealth of tools and technologies that can be used by other businesses to build cloud-based microservice architecture.


When Netflix announced its big move to the cloud, it received a lot of flak because no one thought such a feat was possible at the time. The main reason Netflix decided to move to the cloud was that it was difficult to store its rapidly increasing data and user information in its current data centers, which caused a slew of issues. Amazon Web Service (AWS) was used to implement the solution, which promised to provide large computing resources and data centers with guaranteed security and reliability. Scaling with AWS takes only a few minutes and requires no user intervention.




Netflix is one of the most popular streaming platforms in the world. As a result, it becomes the platform's responsibility to consistently satisfy its customer base. Netflix is already thriving in the industry thanks to AI/ML/Data. Indeed, there may be more to come. However, if you want to become an expert in AI or ML or a data scientist, you must first obtain the necessary certifications and training.


Netflix has done an outstanding job of applying AI, data science, and machine learning the "right way" — by focusing on business needs first, then AI solutions second, rather than the other way around. When used correctly, AI can work wonders. We've seen how effective AI solutions can be in personalizing the experience for the benefit of both Netflix and users in terms of subscriptions and overall satisfaction.


We've also discussed the limitations of algorithms that "overdo it," such as how the Netflix algorithm presented misleading thumbnails to people of color because the algorithm optimized for clicks, effectively "tricking" the users into clicking bait. This occurred even when the thumbnail did not accurately depict the video.


No algorithm can account for all of the nuances of a human experience. In fact, algorithms designed to exploit metrics will do just that — so it is the role of the product manager to work with design or other team members to find ways to address these deficiencies in algorithms.

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