Key to Netflix's future: better recommendations

Netflix has always looked for new ingredients to cater to the specific tastes of different viewers. For instance, it once offered $1 million to any engineering team outside the company that could use its viewing data to improve the recommendation system by at least 10 percent. The contest drew about 50,000 participants, and the winning team took nearly three years to get there.

Netflix is trying to make improvements far more quickly these days, striving to reach a goal that could fit into the category of "Far-out fantasies featuring computer-coding geeks."

"My Utopian state would be for us to understand our subscribers so well that we can eventually just put one recommendation on the screen with nothing else there but a play button," Yellin says.