• by George Simpson , Featured Contributor, February 1, 2018

I read in a research report that some bankers think "Netflix’s competitive advantage [is its] ability to provide personalized content on a global scale while utilizing customer data to curate and ease discovery based on consumer preferences."

So basically, based on what you have watched in the past, Netflix can promote other shows or movies to you it assumes you also will like.  You know, kind of like how Amazon swallowed the retail business starting with "if you liked that book, then try this one."

All this sounds good in theory, but if you have spent any time at all on Netflix, you know its recommendations make almost no sense whatsoever, and are more often wrong than right. Its scrolling presentation of recommendations is slow, hard to navigate and hardly ever results in something truly interesting to me. Moreover, it tends to forget that I invested 20 or 30 hours in one show a few months ago, and fails to tell me when a new season has begun.

And finally, while it rates on a percentage basis what you will like, it seems to take into account only the broad show theme -- not if it's a quality production. So much for early machine learning.

I agree that finding out about new shows (wherever they originate) is a daunting task.

Still, some cable station beat you to death with promos and previews to the point you become resentful -- and how many times have you see the same preview at a theater time and again? No wonder it's hard to get people to turn off their cell phones.

One of the ways networks rationalize the risk of spending millions for live sports and award show rights is that they get to promote their upcoming shows to big audiences (did I mention that those ads can cost $5 million for 30 seconds?). So, if you miss a network premiere, then you need to get your nose out of your phone every time an ad comes on TV.

But we digress.

One of the ways companies try to justify their currently massive valuations is to tout their investments in artificial intelligence. This is shorthand, for "we will be able to cut human mistakes and costs to a minimum and simple rely on predictive data to transact in the future."

Raise your hand if you can't wait to get into one of those cashier-less Amazon shops.

The other side of AI is that it's supposed to analyze mountains of data and help you not only understand what it all means, but deploy the results to improve your business. For Netflix, this would mean more accurately inviting me to see spot-on shows and not content that only has a vague thematic relationship to other shows I have watched in the past.

Perhaps Netflix has a head start on its "competitive advantage" -- but it has a long way to go.