An introduction
Over the past three years I've been actively investing in and working alongside companies at the leading edge of various technical fields, including AI and semiconductor technology—two pivotal elements driving the rapid evolution of AI.
I know AI is often viewed with skepticism and dubbed a dirty word in the entertainment industry, but its rapid development is undeniable. We are witnessing an acceleration in AI that is poised to continue, if not intensify, in the years ahead.
This experience has given me early access to groundbreaking AI technologies and companies specializing in generating text, images, music, and video content. The quality of output is astonishingly high, to the point of being scarily impressive. And it's only improving from here.
This surge in AI will bring forth a transformative time for entertainment, reminiscent of the shifts from Blockbuster to Netflix and theaters to streaming. This period will certainly challenge many, and not all will weather the transition. However, those that emerge on the other side will find themselves at the dawn of a new golden age in storytelling and content creation, an era that will leave a lasting impact for generations.
Self-generated content / entertainment is on the way.
I believe that within 10 years (and maybe as soon as 5), a large percentage of the content we enjoy will be self-generated. In other words, many of the things we watch, read and listen to will be generated by AI. Often times on the spot by ourselves.
This will especially be true for children, as they care less about the overall quality of the content and more about high-level concepts.
Let me give a quick example. I have two young boys (5 and 1) that love watching Bad Dinosaurs on Netflix.
Today, my five year old opens Netflix and navigates to his favorite episode(s) to watch (and re-watch…). But when my youngest is five, he'll navigate to Netflix, and instead of selecting an existing episode he'll create his own right on the spot.
“I want an episode where there's a giant sea monster!”
Within seconds, an episode will be created that will be indistinguishable from the episodes that we see today.
From here he can choose to save his creation (to re-watch later), remix it (“again, but add a volcano eruption.”) or create a brand new episode. This pattern will repeat over and over again. I mocked up a simple exploration here.
Millions of episodes of Bad Dinosaurs (for example) would be created each year.
New characters will be created specifically for this medium.
This technology extends far beyond existing characters; it opens the door to the creation of entirely new personas and universes as well.
This is more than likely the best approach at the beginning anyways. While established characters bring an audience of existing fans, it wouldn’t be the same if millions of new episodes were being created each year for them.
Instead we’ll likely see the emergence of fresh characters and series designed without any pre-existing episodes (but instead will have months of training data, rules and artwork to pull from).
Millions of original episodes will be created each year, many of which will become new all-time favorites for the fans creating them.
It won’t just be video, but expand into all aspects of digital entertainment and merchandise
This technology would enable customers to create a variety of digital experiences, including books, audio stories, coloring books, and music or songs. Furthermore, this digital content can be transformed into tangible items, such as printed books, posters, t-shirts, and other merchandise, allowing for a seamless blend of digital creativity and physical goods.
I could imagine a Netflix Create app that would allow the creation of Bad Dinosaurs (again, for example) audiobooks, stickers, digital coloring books, and more.
The streaming wars will heat up, but Netflix has the upper hand.
This future will not be unique to Netflix. Disney and other streaming platforms will adopt this form of content as well. YouTube will give these tools to its creators to create new content. The next Pixar and award winning animation studio could very well stem from this process (And I think is very likely).
In a way Disney and other historic studios have a unique advantage in the IP they posses. Their ability to leverage these characters and expand on them with AI would be a powerful combination.
However, where others lack is their ability to innovate. Especially when it comes to technology. And make no mistake, this is no easy technical feat.
Looking at the data one might say that there's Netflix and then everyone else. This is true when factoring in the streamers. However, when looking at the broader picture of attention and services like YouTube and TikTok, there's plenty of room for Netflix to continue to compete.
AI user generate content provides a stickiness that keeps customers coming back. In a way it's similar to games, in that it might not be the reason that customers arrive at the platform (although I would argue that this would be), but certainly a reason to stay in between the release of their next favorite show / movie.
A Harmonious Coexistence with Traditional Content Creation
Viewing the rise of AI as a threat to traditional content creation misses the broader picture. This new medium should not be seen as a doomsday for the creators who have long been the backbone of entertainment history.
Instead, it represents an additional layer of interaction and creativity, allowing audiences to engage with their favorite characters in more personalized and imaginative ways. Far from replacing human creativity, AI-generated content could augment it, offering tools that put the power of creation into the hands of fans, thereby fostering a deeper connection with the content they love.
This will take time and attention, so it’s important to start early
While the trajectory of AI development is accelerating faster than anyone is prepared for, crossing the final threshold into full optimization and refinement—the leap from 90% to 100%—will be exceedingly challenging.
This final push towards perfection, where Netflix would aim to position itself, requires not just time but a deep integration of AI technologies with creative processes, an understanding of audience engagement through data, and a nuanced approach to storytelling that only comes from prolonged experimentation and learning.
Starting early ensures that Netflix can navigate these complexities at a measured pace, allowing for the cultivation of expertise and the development of proprietary AI tools and methodologies that align with its history of storytelling excellence.
The time to start is now. And what a wild road it will be.