Netflix accelerates production and cuts costs with generative AI

Debate continues over how AI will impact jobs in visual effects

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Netflix recently unveiled a revolutionary use of artificial intelligence in its series The Eternaut. For the first time, generative AI was used to create visual effects, specifically a scene in which a building collapses. Co-CEO Ted Sarandos emphasised the technology’s ability to generate complex sequences faster and at much lower costs than traditional methods.

This technological breakthrough marks a significant milestone for Netflix and the entertainment industry as a whole. The creators of The Eternaut are reportedly very pleased with the results achieved through generative AI.

The announcement coincided with the financial report of Netflix for the second quarter. The streaming service saw its revenue rise by 16% year-on-year, reaching €9.4 billion. Profits climbed from €1.8 billion to €2.6 billion. The success of Squid Game: The Challenge played a crucial role in these impressive figures, with 122 million views.

 
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Despite the excitement about AI’s potential, its application in the entertainment industry has sparked debate and concern. Critics argue that generative AI could exploit existing creative works without permission. In addition, the technology could lead to job losses. These concerns were central during the Hollywood strikes of 2023, when actors and writers demanded clearer rules for the use of AI.

Filmmaker Tyler Perry even paused a major expansion of his Atlanta studio in 2024, citing concerns about AI’s impact on jobs within the industry. The introduction of advanced AI tools like OpenAI’s Sora has generated both excitement and anxiety. Sora can generate high-quality images from text prompts, thereby impacting the creative sector.

Many professionals in the industry, however, see AI more as a valuable addition to the creative toolbox than as a replacement for human artists. Davier Yoon, co-founder of animation studio CraveFX, believes Netflix’s decision signals a broader shift in the sector. He points out that generative AI enables smaller studios to create visuals comparable to large-scale productions. At the same time, it is acknowledged that the artist remains the ultimate decision-maker in shaping the final result.

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