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.

Scientists implant device to boost human memory

Scientists have enhanced human memory for the first time with a “memory prosthesis” brain implant. The team behind the device say it can boost performance on memory tests by up to 30%, and a similar approach may work for enhancing other brain skills, such as vision or movement.

Source: New Scientist

Astronomers discover Earth-sized world 11 light years away

A planet, Ross 128 b, has been discovered in orbit around a red dwarf star just 11 light years from the Sun. The planet is 35% more massive than Earth, and it likely exists at the edge of the small, relatively faint star's habitable zone even though it is 20 times closer to its star than the Earth is to the Sun.

Source: Ars Technica

An algorithm can see what you've learned before going to sleep

Researcher fed the brain activity from sleeping subjects to a machine learning algorithm, and it was able to determine what the subject had learned before falling asleep. In other words, an algorithm was able to effectively ‘read’ electrical activity from sleeping brains and determine what they were memorising as a result.

Source: Motherboard

Elon Musk unveils Tesla Truck and Tesla Roadster

Elon Musk has unveiled the long-anticipated 'Tesla Semi' – the company's first electric articulated lorry. The vehicle has a range of 500 miles on a single charge, and will go into production in 2019. Unexpectedly, Tesla also revealed a new Roadster, which will have a range of close to 1,000km (620 miles) on a single charge and will do 0-100mph in 4.2 seconds.

Source: BBC

Arrivo plans to build 200mph hyperloop-lite track

Arrivo, the company founded by former Hyperloop One engineer Brogan BamBrogan, has announced a partnership with Colorado’s Department of Transportation. Arrivo will now build a magnetised track to transport existing vehicles, cargo sleds and specially designed vehicles alongside preexisting freeways at 200mph in the city of Denver.

Source: The Verge

Boston Dynamics' Atlas robot can now do backflips

It's been a busy week for Boston Dynamics, first the company revealed it SpotMini robot dog was getting an upgrade, and now the company has shared a video of its Atlas humanoid robot leaping from platforms and doing a backflip. It seems like an obvious thing to say, but it's not easy to make a robot do a backflip, so how Boston Dynamics has managed it is anyone's guess.

Source: WIRED

The all new Factor Magazine is here – your guide to how today, tomorrow and beyond are being shaped

Guess who’s back, back again.

It’s been a few months, but Factor has returned with a bigger and better format, bringing the same future news and discussion, but on a platform that you can read on any device.

We’ve been working towards this for a long, long time: this is how we’ve always wanted the magazine to look, and we’re so happy to share this with you. It can be viewed on any web browser, on anything from a mobile to a monster PC, and if you’re on a desktop or laptop, click the button in the bottom right-hand corner for the ultimate shiny reading experience. A digital magazine has never looked this good. Probably.

Unfortunately that means no more iPad app, but as you can easily read the magazine from an iPad web browser, we hope you’ll agree that what we’ve gained is so much better than what’s been lost.

So anyway, here it is: the Winter 2017 issue of Factor, the first issue of the quarterly version of the magazine.

In case any of you are worrying about us publishing the magazine quarterly, trust us you don’t need to. We’ve produced the biggest issue of Factor ever, so packed with futuristic awesomeness, that we’ve had to divide it into three sections: Today, Tomorrow and Beyond.

Today deals with the futuristic present, as much of what we think of as ‘the future’ already exists today. We look at how humanoid robots are being employed as co-workers, hear from the legendary Richard Stallman about the vanishing state of privacy and discover how automation is already taking jobs. Plus, we take a light hearted look at the futuristic world of Mr Tesla, Elon Musk, and provide our festive present suggestions in a bumper futuristic gift guide.

Moving on to Tomorrow, and it’s all about the world of the next few decades, as technologies that are in development now reach fruition and seep into our everyday lives. We consider how flying cars are inching towards reality, with a look at both Lilium and the newly announced UberAir, and find out how driverless delivery may be the first true instance of the self-driving future.  Plus, we also look at the Christmas dinners of the future, because why the hell not.

Finally, in Beyond we look at the way-out future that many of us probably won’t live to see, but is supremely cool to think about. We ask leading futurists to predict what’s in store in the 22nd century – not the most positive of pictures, unfortunately – and consider what jobs will remain in a post-automation world. Plus, we look at the potential first homes of the human race beyond the solar system, and check out how asteroid mining is set to shape off-earth development.

Take a look, and if you like what you see and read, please share the magazine with your friends, or tell us what you think. This is a completely free magazine, with not an ad in sight, so it’s always good to know that it’s worth the effort.