Netflix is working on a new video compression strategy, and they've published a very detailed blog post about it.
We've spent years developing an approach, called per-title encoding, where we run analysis on an individual title to determine the optimal encoding recipe based on its complexity. Imagine having very involved action scenes that need more bits to encapsulate the information versus unchanging landscape scenes or animation that need less. This allows us to deliver the same or better experience while using less bandwidth, which will be particularly important in lower bandwidth countries and as we expand to places where video viewing often happens on mobile networks.
The technical details go way over my head, but the basic premise seems to make sense to a layman such as I.