In a surprising move, Netflix has revealed its first use of generative AI for visual effects in the Argentine sci-fi series The Eternauts. During a recent earnings call, co-CEO Ted Sarandos disclosed that AI technology was deployed to create a dramatic building collapse scene in Buenos Aires, marking a major shift in how streaming platforms approach content production.
The innovation reportedly allowed the production team to complete the sequence 10 times faster while significantly cutting costs, opening new possibilities for lower-budget shows.
While Netflix executives celebrated the AI-generated effects as a creative and financial breakthrough, the move reignites tensions in the entertainment industry over AI ethics. Concerns persist that generative AI could replace human artists and use copyrighted material without permission.
These fears were central to the 2023 Hollywood strikes, where unions like SAG-AFTRA demanded stricter AI regulations to protect jobs and intellectual property. Sarandos defended the technology, emphasizing its role in making high-end VFX accessible to smaller productions, but critics warn of unintended consequences for creative professionals.
Squid Game Fuels Record Profits as Netflix Invests in AI Innovation
The revelation came alongside strong Q2 earnings, with Netflix revenue jumping 16% to $11 billion and profits surging to $3.1 billion. The platform credited hits like Squid Game: The Challenge—which drew 122 million views—for boosting subscriptions.
Yet, behind the financial success, Netflix’s AI experimentation shows a strategic push toward cost-efficient production methods. Sarandos hinted that more AI-assisted content could follow, stating, “The cost [of traditional VFX] wouldn’t have been feasible for a show in that budget.”
Will AI Become the New Normal in Streaming?
As Netflix pioneers AI in original programming, the industry faces a pivotal question: Is this a niche experiment or the future of filmmaking? While AI optimists are stressing its potential to democratize effects work, skeptics fear a slippery slope toward fully automated production. With Hollywood still wary after the 2023 labor disputes, Netflix’s next steps might be the determinant to whether AI becomes a tool—or a replacement—for human creativity.
