Variety has an outstanding article about a four-year effort by the super smart people at Netflix and research institutes to rethink how Netflix video is encoded. Back in 2011, Netflix’ encoding team realized they had their approach all wrong. The Netflix approach was to take all video and encode it for three potential bandwidth speeds: super slow, regular, and fast enough to support full 1080p video. They had good reason for doing so since speeds do differ from customer to customer and even while you’re watching a video (many people have seen the resolution drop or come back up while watching a show). But the team realized that not all videos are the same–or as they put it My Little Pony is not the Avengers.
Translation: computers can compress simple images and animation much better than high action shots with lots of debris and smoke. So the encoding team worked to develop a solution that didn’t just create different profiles for types of video but instead analyzes every video and comes up with a profile for that video. The result is a much lower sized file meaning that if your bandwidth stays the same you should get better resolution consistently. Netflix experimented with their highest definition content and found they could get up to 20% size reduction without picture degradation. Netflix has already re-encoded over 1,000 popular videos and expects to complete their entire library by the end of March 2016 before possibly embarking on a next effort to come up with different encoding profiles for scenes within video, reducing file size even more.