This Tuesday (17), Netflix confirmed 150 layoffs. The number represents a reduction of approximately 2% of the company’s workforce. Since it passed to Check out subscribers earlier this year (For the first time in its history), the company went through a crisis.
“The slowdown in our revenue growth means we also have to slow down cost growth as a company,” said a Netflix representative. CNBC. “Unfortunately, today we have laid off about 150 employees, most of them from the United States,” he continued. Further cuts are expected in other countries, including Brazil.
“These changes are primarily driven by business needs rather than individual performance, which makes it particularly challenging because none of us want to say goodbye to these great colleagues. We are working hard to support them through this very difficult transition.” Actor Live Broadcasting Program.
This crisis won’t be the end of Netflix, at least not in the short term. The company remains the absolute leader in subscribers and bills in billions. In fact, unlike other streaming giants, it is making a profit. But one thing is for sure, the company will never be the same again.
The chances of buying the company increased significantly. Some analysts are already suggesting that merging Netflix and Disney+ would be a great solution to the problems of rising costs and subscriber travel. But merger or not, the market perception of Netflix has radically changed.
From dream job to nightmare
Perhaps the most interesting aspect to note is how to use a file Netflix, one of the most arrogant companies in historyShe has seen her talk evaporate within a few months as subscribers leave the platform.
An example is the recent change in the company’s policy regarding its employees and the content it produces. Basically, I decided that if you work at Netflix and don’t like the content you produce, it’s best to leave it.
The news was added to a new section on “Artistic Expression” in the company’s first update of its corporate culture guidelines since 2017. According to Netflix, the change has been evaluated over the past 18 months and is unrelated to the recent crisis and company controversies.
Disastrous content on Netflix
The company says in the updated part of the document that The Wall Street Journal He has access.
Netflix also says it supports offering diversity in stories, “even if we find some titles conflict with our personal values.”
“Depending on your role, you may need to work on addresses that you think are malicious,” the company says. “If you find it difficult to support our breadth of content, then Netflix may not be the place for you.. “
The measure comes after a series of Criticism and protests from Netflix employees themselves directed at the company’s board of directorsnotably co-CEOs Reed Hastings and Ted Sarandos.
It was one of the most famous controversies The Closer movie by comedian Dave Chappelle was released last year. The show has been accused of being a transphobic for its gratuitous attacks on the LGBTQ+ community. In addition, The Closer was expensive and unprofitable, a fact indicated by documents leaked by an employee of Netflix itself.
Management separated from reality?
For many, the show has only streamed on Netflix because President Ted Sarandos is a fan of comedy and treats Chappelle (whom he is a friend of) like one of his idols. With the controversy surrounding the show growing, Sarandos passionately defended Chappelle’s show.
Internal memos containing clumsy texts that the Netflix CEO sent to its employees in an attempt to defend Chappelle’s position and Netflix’s insistence on supporting transphobic content made the situation worse.
Unsatisfied, Netflix employees went to the company’s door in Los Gatos, California, to protest publicly. One of the protest leaders was fired. Netflix has denied the dismissal was due to the demonstration.
A questionable society in Russia
Subsequently, Sarandos said he “blew it up” in his efforts to reach out to employees. But the content was never pulled from the platform.
The Chappelle affair was not an isolated event. To enter Russia, for example, Netflix has become a partner in a company owned by one of President Vladimir Putin’s closest allies, And that it has Alina Kabaeva, a former Olympic gymnast who appointed Putin’s longtime girlfriend, as CEO. At that time, Russia was already the target of accusations of disrespect for human rights.
Once again, Sarandos and Hastings made the decision to enter Russia through a dubious partnership. Several Netflix managers objected to the deal, which resulted in the streaming giant leaving Russia and losing hundreds of thousands of dollars.
Swimming without swimming trunks on the beach
Investor Warren Buffett often says that when the tide goes out, you find out who’s swimming without their swimwear. With the streaming crisis, it looks like Netflix is revealing a new face.
Over the years, Netflix has become one of the most hated by its peers. It “stealed” employees from other companies by offering unrealistic salaries inflated by company stock, paying talent to break contracts already closed with other platforms, and above all, saying its technology and content were outperforming competitors.
Reed Hastings’ management book, which portrayed Netflix as a paradise for intellectually superior beings, increasingly looks like a joke in the face of the company’s current reality. The truth is that in the crisis companies shoot and everyone suffers. But Much of Netflix’s success has come from money pouring in from investors.
At this point, it would be natural to imagine Netflix would “wear the humility sandals,” but that doesn’t seem to be the plan. Netflix has announced a series of measures to reverse the decline in ratings. You’ll charge more for those who share passwords, bring publicity to the platform, fire up costs and increase control over production processes.
Content should be the answer
The Netflix adopts commonplace normal solutions for any business in crisis. But it is interesting to note that of all the solutions considered by the company, no one is talking about content optimization.
If subscribers are leaving, it is because they perceive less and less value in the product they receive, and streaming is essentially content. By adopting measures that prevent its employees from complaining about what they produce, Netflix is shooting itself.
A Netflix spokesperson said employees have been given an opportunity to provide feedback on the company’s new cultural guidelines. He said the company had received more than 1,000 comments, which helped shape the new portion of the memo.
Just as Netflix has increasingly ignored the advice and criticism of producers and directors over the years, it now wants to silence its employees. We’ve already seen this movie and everyone knows the ending: subscriber leaks, crises, layoffs.
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