Take a Bow, Netflix: How the streaming service won 2016

2016 has been a damn good year for Netflix, with a number of award winning programmes being launched. We take a look at what has gone well for the streaming service and what is still to come

Let’s have a round of applause for Netflix. In July the streaming service gave us Stranger Things; in August the stylish The Get Down launched; in September we (spoiler alert) briefly caught up with Pablo Escobar in Narcos, and in October Marvel’s Luke Cage made his debut as a series lead in the imaginatively titled Marvel’s Luke Cage. To have one hit show in a year would be good, two is great, but to have four in half a year – and we haven’t even mentioned Black Mirror – is unbelievable.

2016 has undoubtedly been the year that Netflix has achieved supremacy in home entertainment, but the streaming service remains essentially a technology company and it’s this – the ability to analyse vast amounts of data about its customers’ viewing preferences, so it can decide what content to buy and how much to pay for it – that is separating it from traditional television networks. But with each successful launch, it’s hard to argue against the fact that Netflix is becoming more than just a technology company; it’s becoming a media giant.

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Image courtesy of Maxx Satori / Shutterstock.com. Featured image courtesy of Twin Design / Shutterstock.com

Thanks to its new status, Netflix finds itself in the unenviable position of having to compete with companies with much larger resources because being a television network comes at a cost. A massive, eye-watering cost. In a letter to shareholders that detailed Netflix’s results for the third quarter of 2016, the company announced that although quarterly global streaming revenue had exceeded $2bn for the first time, its net income for the same quarter was only £52m and streaming content obligations – the money Netflix pays to license, acquire and produce content – just reached £14.4bn.

Being a technology company, Netflix seems to see innovation as the answer to any problems it has, so in 2017 we’ll see at least another 400 hours of original content – from 600 hours to over 1000 – and rumours suggest that Netflix may introduce downloads by the end of the year. But can Netflix thrive in the new media world it has created? And more importantly, can Netflix continue to hit home runs when it comes to content?

Room to create

Netflix explains that it is able to create award-winning content because of its ability to “support programs for both mass and niche audiences alike”. In a letter to shareholders the company said: “Since we are not shelf-space constrained nor reliant on advertising, we have the luxury to tell all kinds of stories in less traditional ways. The growth of internet TV globally has ushered in a new golden age of content, with consumers everywhere enjoying unprecedented access to amazing amounts of high quality programming.”

Like any good technology company, Netflix monitors streams of data to predict what shows will work and what won’t. But it isn’t all about data. Netflix, unburdened by genre, advertising revenues or ratings, can pretty much commission what it wants.

“The worst thing you can do at Netflix is say that you showed it to 12 people in a focus room and they loved it,” said Todd Yellin, the company’s vice president of product innovation, in an interview with the New York Times.

Marvel's Luke Cage. Source: Netflix

Marvel’s Luke Cage. Image courtesy of Netflix

Netflix doesn’t have adverts, so it doesn’t need to aggregate viewers for advertisers, care about ratings or make programmes that are written, shot and edited to accommodate commercial breaks. All of this means Netflix can afford to be bolder with its content. There aren’t too many media companies who will give a home to foreign language television programmes (Narcos) or programmes that have female or black leads (Jessica Jones, Luke Cage), but Netflix does.

There also aren’t too many television networks who give creatives the amount of freedom Netflix does. What started as a way to beat HBO to House of Cards has become Netflix’s standard practice, so shows no longer need a pilot and can be commissioned for multiple series without having to worry about ratings.

“Netflix are daring and try to tell stories that would never be aired on linear TV,” a spokesperson for Netflix told Factor.

Netflix eyes China

As Netflix attempts to get a foothold in new territories, like China, we’ll see more shows that cater to different nationalities and cultures. Netflix CEO Reed Hastings said at the DealBook conference in New York that the company is “hopeful that we’ll over time make a great Bollywood show, make a great anime show”.

The company is already experimenting with this. Narcos is produced in Bogota, Columbia, features Brazilian actors and is directed by a Brazilian, but most importantly is delivered in English and Spanish, which allows Netflix to target its Spanish-speaking audience.

50%, and growing, of nearly 1.4 billion people is the equivalent of hitting oil to Netflix

But it’s China that the company is really targeting because, as subscriber numbers plateau in Netflix’s established markets, China represents an untapped well. In a dollar bills appearing in Reed Hastings eyes and the sound of tills opening kind of way.

If Netflix wants to continue to spend lavishly on its own programming as well as secure licences for shows like Star Trek: Discovery and The People vs. O.J. Simpson: American Crime Story then it needs the increased revenue breaking the Chinese market would present. There’s a reason everyone from Disney to Apple wants to get into China: internet usage in China currently stands at 50% of the population, according to the World Bank. 50%, and growing, of nearly 1.4 billion people is the equivalent of hitting oil to Netflix.

“The regulatory environment for foreign digital content services in China has become challenging,” reads Netflix’s statement to investors on the subject of China. For the minute Netflix is attempting to solve its China problem by licensing content to existing online service providers, rather than operating its own service in the country, but the modest income this will accrue is nothing compared to the potential earnings that would come with getting Netflix into the country itself.

The Pill

In Bill Hicks’ Revelations stand-up performance he ruminates on how the stunts in Terminator 2 are ever going to be topped. Netflix may be in a similar position now because it’s hard to come out with hit after hit after hit. Hicks suggested using terminally ill people as stuntmen; this isn’t an avenue Netflix is expected to go down, but the company has some, only-slightly less, outlandish plans.

Speaking at The Wall Street Journal’s WSJD event, Hastings said that in the long term “movies and TV shows will be like opera and the novel…There will be substitutes”. One possible substitute mentioned by Hastings could be “pharmacological” meaning Netflix is possibly considering an entertainment drug that viewers could use to put themselves in the midst of a story.

factor-archive-30To be honest, the idea sounds like something borrowed from Bill Hicks, but it is indicative of what makes Netflix great. It’s a company that isn’t planning on letting its product become obsolete, and even though it becoming a television network, Netflix will never forget that at heart it is an innovative technology company. So while there probably aren’t any chemists working on Netflix’s pills yet, don’t expect the company to be satisfied with just producing hit television in the years to come.

Soviet report detailing lunar rover Lunokhod-2 released for first time

Russian space agency Roskosmos has released an unprecedented scientific report into the lunar rover Lunokhod-2 for the first time, revealing previously unknown details about the rover and how it was controlled back on Earth.

The report, written entirely in Russian, was originally penned in 1973 following the Lunokhod-2 mission, which was embarked upon in January of the same year. It had remained accessible to only a handful of experts at the space agency prior to its release today, to mark the 45th anniversary of the mission.

Bearing the names of some 55 engineers and scientists, the report details the systems that were used to both remotely control the lunar rover from a base on Earth, and capture images and data about the Moon’s surface and Lunokhod-2’s place on it. This information, and in particularly the carefully documented issues and solutions that the report carries, went on to be used in many later unmanned missions to other parts of the solar system.

As a result, it provides a unique insight into this era of space exploration and the technical challenges that scientists faced, such as the low-frame television system that functioned as the ‘eyes’ of the Earth-based rover operators.

A NASA depiction of the Lunokhod mission. Above: an image of the rover, courtesy of NASA, overlaid onto a panorama of the Moon taken by Lunokhod-2, courtesy of Ruslan Kasmin.

One detail that main be of particular interest to space enthusiasts and experts is the operation of a unique system called Seismas, which was tested for the first time in the world during the mission.

Designed to determine the precise location of the rover at any given time, the system involved transmitting information over lasers from ground-based telescopes, which was received by a photodetector onboard the lunar rover. When the laser was detected, this triggered the emission of a radio signal back to the Earth, which provided the rover’s coordinates.

Other details, while technical, also give some insight into the culture of the mission, such as the careful work to eliminate issues in the long-range radio communication system. One issue, for example, was worked on with such thoroughness that it resulted in one of the devices using more resources than it was allocated, a problem that was outlined in the report.

The document also provides insight into on-Earth technological capabilities of the time. While it is mostly typed, certain mathematical symbols have had to be written in by hand, and the report also features a number of diagrams and graphs that have been painstakingly hand-drawn.

A hand-drawn graph from the report, showing temperature changes during one of the monitoring sessions during the mission

Lunokhod-2 was the second of two unmanned lunar rovers to be landed on the Moon by the Soviet Union within the Lunokhod programme, having been delivered via a soft landing by the unmanned Luna 21 spacecraft in January 1973.

In operation between January and June of that year, the robot covered a distance of 39km, meaning it still holds the lunar distance record to this day.

One of only four rovers to be deployed on the lunar surface, Lunokhod-2 was the last rover to visit the Moon until December 2013, when Chinese lunar rover Yutu made its maiden visit.

Robot takes first steps towards building artificial lifeforms

A robot equipped with sophisticated AI has successfully simulated the creation of artificial lifeforms, in a key first step towards the eventual goal of creating true artificial life.

The robot, which was developed by scientists at the University of Glasgow, was able to model the creation of artificial lifeforms using unstable oil-in-water droplets. These droplets effectively played the role of living cells, demonstrating the potential of future research to develop living cells based on building blocks that cannot be found in nature.

Significantly, the robot also successfully predicted their properties before they were created, even though this could not be achieved using conventional physical models.

The robot, which was designed by Glasgow University’s Regius Chair of Chemistry, Professor Lee Cronin, is driven by machine learning and the principles of evolution.

It has been developed to autonomously create oil-in-water droplets with a host of different chemical makeups and then use image recognition to assess their behaviour.

Using this information, the robot was able to engineer droplets to have different properties­. Those which were found to be desirable could then be recreated at any time, using a specific digital code.

“This work is exciting as it shows that we are able to use machine learning and a novel robotic platform to understand the system in ways that cannot be done using conventional laboratory methods, including the discovery of ‘swarm’ like group behaviour of the droplets, akin to flocking birds,” said Cronin.

“Achieving lifelike behaviours such as this are important in our mission to make new lifeforms, and these droplets may be considered ‘protocells’ – simplified models of living cells.”

One of the oil droplets created by the robot

The research, which is published today in the journal PNAS, is one of several research projects being undertaken by Cronin and his team within the field of artificial lifeforms.

While the overarching goal is moving towards the creation of lifeforms using new and unprecedented building blocks, the research may also have more immediate potential applications.

The team believes that their work could also have applications in several practical areas, including the development of new methods for drug delivery or even innovative materials with functional properties.