What the long-term impact of generative AI will be on Hollywood is “hard to predict,” Netflix co-CEO Ted Sarandos said — but he took a shot at addressing it anyway.
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Sarandos, speaking on the streamer’s Q2 earnings interview, said, “I think that AI is going to generate a great set of creator tools, a great way for creators to tell better stories.” And, he said, the business case for generative AI isn’t to reduce costs but to improve the quality of storytelling.
“There’s a lot of filmmakers and a lot producers experimenting with AI today,” he said. “They’re super excited about how useful a tool it can be. We’ve got to see how that develops before we make any meaningful predictions about what it means for anybody. But our goal remains unchanged, which is telling great stories.”
His response was prompted by a question from an analyst who cited Variety ‘s “Strictly Business” podcast this week with CTO Elizabeth Stone . In the interview, she said that the current gen-AI wave is “a step function in that technology” and said Netflix is exploring how to integrate it into the product to improve the member experience or how it could “enable creators and bring their visions to life in an even better way.” Stone shared that the company is working on a generative-AI project she described as an “interactive discovery experience.”
During the Q2 interview, Sarandos said, “One thing that’s sure, if you look back over 100 years of entertainment, you can see how great technology and great entertainment work hand-in-hand to build great big businesses.”
Sarandos said you don’t need to look further than animation. “Animation didn’t get cheaper, it got better in the move from hand-drawn to CG animation,” he said. “And more people work in animation today than ever in history. So I’m pretty sure that there’s a better business — and a bigger business — in making content 10% better [using technology] than [there is in] making it 50% cheaper.”
“I think shows and movies, they win with the audience when they connect,” Sarandos continued. “It’s in the beauty of the writing. It’s in the chemistry of the actors. It’s in the surprise of the plot twist.” Audiences “probably don’t care much about budgets and arguably maybe not even even the technology to deliver it,” he added.
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Sarandos had recently commented on AI in a recent interview with the New York Times, in which said expressed doubts AI platforms will replace Hollywood professions such as screenwriters.
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“I have more faith in humans than that. I really do. I don’t believe that an AI program is going to write a better screenplay than a great writer, or is going to replace a great performance, or that we won’t be able to tell the difference,” Sarandos said. “AI is not going to take your job. The person who uses AI well might take your job.”
Also on the Q2 interview, co-CEO Greg Peters said Netflix has been using AI and machine-learning for years in its content recommendations, echoing Stone’s comments. “We think that generative AI has tremendous potential to improve our recommendations and discovery systems even further,” he said.
But Peters also noted that “the key to our success stacks — it’s quality at all levels,” starting with great TV shows and movies together with “a great and constantly improving recommendation system that helps unlock all of that value for all of those stories.”
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