Earlier quoted context omitted.
Recompression matters because most video compression is lossy . Every compress/decompress cycle introduces noise and artifacts.
right, which means by definition any compression is going to lose quality, even if done directly off the original, lossless versions. that's the point, it's the quality of the input that matters, not the fact that it's been compressed previously.
Original source video > Netflix video stream (1 level of lossy encoding) > Recompressed video stream (2 levels of lossy encoding)