How Netflix keeps you Netflix hooked

21

October

2017

5/5 (2)

Netflix quickly grew into empire it has today, within 5 years it has grown from 26 million to over 100 million subscribers (source). With a simple monthly subscription based user model, they do not rely on advertising income, providing viewers solely with what they want to see whenever they want to see it. Especially, as their app is compatible with many screens beyond television. All that is needed is an internet connection. With supply side economies of scales, they are able to provide to an almost unlimited customer base with marginal costs close to zero.

Their most important asset however has not yet been mentioned. Data. Like many other internet companies, they are able to track every single move viewers make. Not only does this allow them to use it in a similar way as Amazon does by creating recommendation based on complicated algorithms and big data analytics. It also allows them to formulate predictions of which shows will be successful based on aggregated data from the behaviour of over 100 million viewers. Not only do they track what genre those viewers watch, but also what actors, colours, when pause was pressed and the device on which is watched to name a few. This information also provides critical insights when deciding on new titles, especially s they do not focus on the long tail. When deciding on House of Cards, they made many comparisons with Macbeth based on quantifiable data to create predictions and increase the likelihood their viewers would like it. With all this knowledge, Netflix is one of the most interesting and innovative companies in the film-industry. Finally, to provide an insight in the secret of Netflix, Jeff Magnusson, serving as data platform architecture manager at the company, provides three key point of Netflix’s data philosophy used during all their analysis:
1. “Data should be accessible, easy to discover, and easy to process for everyone.”
2. “Whether your dataset is large or small, being able to visualize it makes it easier to explain.”
3. “The longer you take to find the data, the less valuable it becomes.”

Sources:

Big Data Lessons From Netflix


https://www.fool.com/investing/general/2015/09/30/how-netflix-inc-really-creates-value.aspx

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What A.I. really is – the buzzword and more

20

October

2017

5/5 (1)

Let’s be clear once and for all what AI really is and what it stands for. After reading one misrepresentation after another, let us be clear about where the line between machine learning and other buzzwords starts and where it ends.

A.I. has become such a buzzword, it seems almost every business is engaged with it, or is wants to be in the near future, without completely understanding what it is. Companies are even approaching consultants and tech companies stating they want A.I. without having a clear vision as to what it is supposed to do. After interviewing an intern at Microsoft and MSc student in Artificial Intelligence, even she stated she believes it has become an enormous hype. She continues “People tend to forget it is still statistics and math models, it is not a magic answer to any problem. Everything would still need to be build and programmed.”

Even so, all large companies seem to be investing and experimenting with it, hoping to be the new leader in the market. Hereby, they seem to fuel that new trend and bubble called A.I. One must note however, this works in their favour. A study conducted in 2015 by Jurriaan Nijholt et al. concludes “that even without needing to adopt the practice, merely using buzzwords that are in fashion can lead to companies being overvalued.” Even though they focused on buzzwords such as big data and outsourcing, one can expect this to apply to A.I. as well. So once and for all, lets define the buzzword and try to take away the “buzz” around it.

As one of the founding researchers and professors on A.I. has defined it, “Artificial Intelligence is that activity devoted to making machines intelligent and intelligence is that quality that enables an entity to function appropriately and with foresight of its environment.” This differs from machine learning in a sense that machine learning is a type of A.I. focused solely on enabling computers to use observed data to evolve new behaviours that have not been explicitly programmed. Thus, shortly stated, A.I. consists of unprompted information and mimicking human thinking, whereas machine learning focuses more on prompted information. This concept is further clarified in the picture shown.

Thus, A.I. is not the answer to everything. It does however contain the newest technology and provides many opportunities. By encompassing machine learning and data science, A.I. will have a significant effect on the future, but if it is significant progress or a bubble burst, we will have to wait and see.

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