AV1 is good enough that the cost of not licensing might outweigh the cost of higher bandwidth. And it sounds like Netflix agrees with that.
AV1 definitely is missing some techniques patented by h264 and h265, but AV2 is coming around now that all the h264 innovations are patent free (and now that there's been another decade of research into new cutting edge techniques for it).
h264 is a very good codec.