What does Netflix tell us about AI costs in Hollywood?
Happy Tuesday.
The current thing in tech and business is Gemini releases 3.6 Flash.
Today’s Lineup
Augustus Co-Founder & CEO Ferdinand Dabitz at 11:55 AM
Lightphone Co-Founder & CEO Kaiwei Tang at 12:05 PM
Substack Co-Founder & CEO Chris Best at 12:15 PM
Whop Co-Founder & CEO Steven Schwartz at 12:35 PM
Business Insider Editor at Large Katie Roof at 1:00 PM
Dimension Founder Zavain Dar at 1:15 PM
CuspAI Co-Founder Chad Edwards at 1:25 PM
Run of Show
What does Netflix tell us about AI costs in Hollywood?, by John Coogan
Netflix is down ~10% in the last week after announcing that they expect both revenue and profit to slow in the third quarter. Investors are now worried that we’re past peak Netflix growth. Now, the company is still growing, 11.7%, but this is the smallest YoY increase since late 2023. The bull case is that Netflix only has 5% TV market share globally. The bear case is increased competition from social media, vertical video, free to play games, and maybe AI content in the future.
Eric Seufert over at Mobile Dev Memo is not happy about the decrease in detailed KPI sharing from Netflix over the years ( great read ) and over at Stratechery there are two pieces from Ben and Andrew studying the fall off of Netflix (and of course debating it honestly).
The big question I have today is less about Netflix directly and more focused on what we can learn about the impact of AI adoption in Hollywood broadly. I still think of Netflix as a tech company first, even though they are very much a Hollywood entity at this point. They should be early adopters of AI and indeed have already been using AI in productions. Variety recently reported that Netflix used generative AI across roughly 300 movies and TV shows during the first half of 2026. Some AI is used in the early stages of storyboarding, some is sneaking into post-production. Their new docuseries about the American Revolution included 17 minutes of AI-enhanced footage t…
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