Fresh off a big earnings report in January, Netflix today unveiled its plans to produce and release 1,000 hours of original programming as it seeks to distance itself streaming from competitors such as HBO and Amazon.
During a live streaming event hosted by Bill Nye, Netflix product manager Todd Yellin explained that the roll-out was part of the company’s continued evolution to focus on more original content in the coming years.
“We want to have as many different creators of as many different types of content so viewers can find what they want,” Yellin said.
Netflix is now in 190 countries, whereas HBO says it’s available in 50 countries outside the U.S. Amazon Prime Video expanded to 200 countries in December.
For some perspective, Netflix says it produced about 600 hours of original content last year. HBO boasted that it would match Netflix last year. It remains to be seen if HBO can keep up this time around. Amazon hasn’t released any data on number of hours of content.
Of course, that’s a ton of content, which represents a huge bet. In its most recent earnings, Netflix noted that its debt had increased in 2016 by $1 billion to $3.4 billion. And it’s on the hook for about $6.5 billion it owes to content producers.
That means Netflix has to find a way to get people to watch even more stuff. Yellin said the company is focused on the problem of not letting customers feel too overwhelmed with their choices.
“By the time they get to Netflix, we don’t want them to have to look through thousand of pieces of content and make a hard decision,” he said. “We know the typical Netflix user is only going to look through 40 or 50 titles.”
And those customers only spend an average of 1.5 seconds to 2 seconds looking at each title, he said.
To help surface the best content for each user, the company is using artificial intelligence to build “taste communities” to understand on a large scale what people with similar watching habits like. The company doesn’t really rely on demographic information like age, geography, or gender because, Yellin said, these are often more limiting and misleading in some cases.
“What we try to do is understand is people’s tastes, not just who they are superficially,” he said. “And that helps us find an audience.”
He said it was this strategy that helped Netflix take the Brazilian show “3%” and connect it with a huge U.S. viewership even though the show is in Portuguese.
“That has found a huge audience in the U.S.,” Yellin said. “Because we can unlock audiences that we haven’t unlocked before.”
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