Ted Sarandos Says After “Lots Of Hype” About AI, Key Question Remains: “Can It Help Make Better Shows And Films?”

Netflix Co-CEO Ted Sarandos called artificial intelligence something of a mixed bag thus far, though it has a chance to become just the latest example of entertainment and tech joining hands.

Fielding a Wall Street analyst’s question during Netflix’s third-quarter earnings call, Sarandos said there has been “lots of hype, good and bad” about AI’s potentially transformative impact.

“Entertainment and technology have worked hand in hand throughout the history of time,” he said. “It’s very important, I think, for creators to be very curious about what these new tools are and what they can do. But AI needs to pass a very important test: Can it help make better shows and better films? That is the test and that’s what we’ve got to figure out.”

Netflix benefits “greatly from improving the quality of the movies and the shows, much more so than we do by making them a little cheaper,” Sarandos added. “So, any tool that can go toward enhancing the quality, making them better, is something that’s going to help the industry a great deal.”

Prior to the call, the company reported strong numbers across the board, including a quarter-to-quarter increase of 5.1 million subscribers, beating Wall Street forecasts.

As one of the key negotiators for the studios and streamers during the dual strikes of 2023, Sarandos grappled extensively with the issue of AI. The WGA and SAG-AFTRA demanded that the technology be limited by the industry as a job-preservation measure. Ultimately, some accommodations were made on that front, though not all demands were met.

The labor unrest came just months after OpenAI introduced a dramatically improved version of ChatGPT, setting off a debate across society and the financial and tech communities about its possible effects. An arms race has since kicked in across most sectors of the economy, with companies betting on various forms of AI transforming their businesses.