When Netflix, Inc. (NASDAQ:NFLX) CEO Reed Hastings appeared at Recode's Code Conference in May, he talked about the high success rate of the company's shows and the need to be more aggressive and more experimental. "I'm always pushing the content team," he said. "We have to take more risk; you have to try more crazy things." 

Longtime investors in the video-streaming pioneer know that the company runs experiments involving its subscribers fairly regularly. Several meaningful changes to the service have been the result of such experiments. Netflix's post-play feature, which begins playing the next episode in a series once you've finished the current one, was the result of just such an experiment. Allowing subscribers to download content for offline viewing was another. Its most recent experiment could revolutionize the streaming concept it created.

Family watching Netflix at home

Image source: Netflix.

Branching technology

In its latest move, Netflix will roll out its groundbreaking branching technology, in a bid to make programs interactive. Only the newest smart TV's, iOS devices, Roku boxes, and game consoles will work with the technology for now. Using a remote, touchscreen, or controller, viewers will have the option during the story to determine the next move the characters make in the program. Each choice leads to more potential choices down the line, producing myriad ways for the same story to unfold.

Netflix announced this week the first in a series of interactive branching narrative programs, beginning with children's content. The animated program Puss in Book: Trapped in an Epic Tale launched on June 20, and Buddy Thunderstruck: The Maybe Pile will make its debut on July 14. Stretch Armstrong: The Breakout will arrive next year.

Here's how Netflix sets the scene:

You sink into the sofa and fire up Netflix. You settle in to watch everyone's favorite swashbuckling feline, Puss in Boots. You chuckle as Puss in Boots finds himself in the story of Goldilocks with the Three Bears staring at him.

And then... you're asked to make a choice:

Should these bears be friends or foes? 

Children will then decide how the story unfolds. In a blog, Carla Engelbrecht Fisher, the director of product innovation at Netflix, pointed out that children brought up with touchscreens are already engaging with them. "They're touching every screen," she says. "They think everything is interactive." This move, then, merely puts interactive television on equal footing with mobile apps and video games.

The Netflix logo on a stylized entryway sign.

Filmmakers are excited by the concept of branching programs. Image source: Netflix.

Wouldn't it be cool if... ?

Netflix enlisted the show's creators and conducted extensive research with kids and parents to ensure the best possible outcome, while using the overriding mantra "Wouldn't it be cool if... ?" Netflix approached DreamWorks Animation executive producer and writer Doug Langdale with the idea. "I didn't really know it was a possibility before," he stated. "As soon as it came up as something we could do, I desperately wanted to do it." 

The programs took two years to develop, and the end result is 13 decision points in Puss in Book, resulting in a story that spans 18 to 39 minutes, depending on the choices made. The streaming giant is eager to learn how members engage with the experience, and to understand if they watch an episode multiple times, since each set of choices leads to a different adventure. If the initial trial with children's programs is successful, the trial will probably expand beyond animated kids' fare.

Pushing the boundaries

Netflix is known for taking chances on programs that wouldn't have otherwise seen the light of day, and that strategy is paying off. Netflix recently exceeded 100 million members, and it continues to look for ways to differentiate its content from competitors such as Amazon.com, Inc. (NASDAQ:AMZN). In its most recent quarter, Netflix surpassed $2.5 billion in quarterly streaming revenue for the first time. The company will want to continue to develop innovative content if it wants to retain the streaming crown. Hastings wants the content team to push the boundaries, and this endeavor seems to fit the bill.

Danny Vena owns shares of Amazon and Netflix. The Motley Fool owns shares of and recommends Amazon and Netflix. The Motley Fool has a disclosure policy.