How Netflix Uses Machine Learning (ML) and Algorithms to Power its Recommendation System

How Netflix Uses Machine Learning (ML) and Algorithms to Power its Recommendation System

In today’s era, Netflix is known to be the go-to streaming platform for series and films. However, most individuals are unaware that the platform was introduced in the late 1990s with a subscription-based model, sending DVDs to customers’ homes in the US.

Netflix operates on a subscription-based model. Put simply, the more users the platform has, the higher its revenue. Moreover, the overall revenue can be seen as a function of three things:

• The rate at which people join
• The acquisition rate of new members
• Cancellation rates

How Important is the Recommendation System of Netflix?

Netflix gains most of the stream time (80%) through the platform’s recommendation system, which is an incredible number. Besides, the platform considers that providing a great user experience will lead to a better retention rate, leading to savings on customer acquisition.

This is How the Recommendation System Works