Real-world video quality is tricky to measure: a bitrate that looks good for a crowd shot might be terrible for a close-up. Netflix, however, thinks it has the problem licked. It developed a tool that measures videos based on perceived quality, not just pure numbers. The technology works by gauging visual information fidelity (how much has changed?), detail loss and the effect of motion. The end result is a test that's much more reflective of real life, regardless of what you're watching; you know what should be appealing, whether it's a live-action drama or an animated kids' movie.
While Netflix created the tool, it's not hoarding the technology for itself. It's releasing the software as open source code, both to let other companies test their videos and to help tackle remaining questions (such as how viewing conditions affect the image). If this pans out, you could see video services of all kinds fine-tuning their streaming to deliver consistent picture quality, no matter what movies and TV shows you enjoy.