Netflix’s Subscriber Loss Has Destroyed Employee Morale

The company is at risk of losing its most valuable resource: its star employees.

One of the most desirable jobs in Hollywood is working atNetflix. The company ranks as one of the most beloved brands, pays well and offers a chance to work with the people that changed the way we watch TV.

It has also erased the value of the company because of its poor financial results. People who spent a lot of money are left with nothing.

Current and former employees said this past week that more people are looking to leave the company right now than at any point in the past. New stock grants were requested by employees to make them whole for the losses this past week.

The culture of freedom and responsibility is the secret to its success.

At the end of last year, the company had more than 11,000 employees, up from 2,000 at the end of the previous year.

Corporate cultures are quite different from Silicon Valley and most of the new employees came from Hollywood and overseas. It didn't always translate that way.

The company is in cost-cutting mode and this challenge will only get harder. Bosses will be under more pressure to deliver and less willing to give their subordinates freedom to make mistakes. It isn't going to hire as many people, and will scrutinize spending. You were supposed to be able to spend whatever you wanted at this company.

The engineering department at the company is being restructured to create levels of junior, senior and so on. Many employees think it's an effort to cut costs. It has always been a flat organization. Many of the people on teams are at the same level as the leaders.

The company did not frame the change like this. It said it was for career advancement.

Both can be true. When it first started, it didn't hire low-level employees. It paid stars double or triple what they would get elsewhere. The junior tier will allow for some lower- wage workers, and it is now large enough that it may need it.

People can make a lot of money at the biggest TV network in the world. It is not collapsing. It is about the same size as Disney+ and HBO Max. It felt like a high-flying disruptor that grew and grew. Now that the company is focused on managing costs, it feels like another corporation.

The company knows that its culture is under stress. The project to rewrite the famous culture memo was started before its recent subscriber struggles.

Hastings will have to remain active to respond to the company's greatest internal and external challenge in a decade. When he named Greg Peters as COO, he seemed to pave the way for succession. Many of his senior employees believed he would give up day-to-day control in the next couple years.

It's hard to see the board wanting that to happen right now.

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The Obamas and Spotify break up

It seemed like a coup when the Obamas signed a deal with Spotify. The Obamas had already agreed to make TV shows and movies for the streaming service. They were going to use Spotify as their exclusive home for their audio projects.

It didn't take long for the relationship with the Obamas to sour. The former president and first lady were not included in the company's output. Two of the most famous people in the world are featured on some shows. Higher Ground wanted to use their deal to provide a platform for a variety of voices.

Higher Ground's deal with Spotify is about to end, and it won't be sticking around. The Obamas are talking to competitors like Amazon and iHeartMedia instead of trying to negotiate a new deal with Spotify.

The end of this partnership underscores a couple themes in podcasting right now:

• Exclusivity is changing. Spotify has spent hundreds of millions of dollars paying for exclusive rights to shows from the Obamas, Kim Kardashian, Joe Rogan, Dax Shepard and Alex Cooper. Spotify used these famous people to lure customers, and the famous people got PAID. But most shows don’t want to be exclusive to Spotify anymore. They’d rather be available everywhere. Amazon has taken advantage, paying a lot of money for just one week of exclusivity. 
• The most valuable podcasts never take a break. Ever since “Serial” changed the world of podcasting, producers tried to replicate its success. But while we may love talking about the latest hot show, the most popular and lucrative podcasts are talk shows that post every week, if not more. Daily and weekly shows – known as always-on – generate consistent listenership that can be sold to advertisers. Limited run series need to build a new audience from scratch, and only run for a couple months. 

Florida cracks down on Disney

Disney's parks have been free of a special zone for the last 50 years.

Disney doesn't have to go through the bureaucratic channels of multiple governments to get things done because the district has its own building codes and approval process.

Chris Palmeri talked about what it means for Disney.

CNN+, we hardly knew ye

CNN+ is shutting down just a month after it was launched. The streaming service will stop operations on April 30 and its leader will leave the company.

CNN spent $500 million on its new streaming service, which was supposed to give it a bridge into the future. The new management from Discovery didn't like the idea of a paid news service. The details about what went wrong for CNN+ are provided by Gerry Smith.

The New York Times has a new leader

Dean Baquet was the editor of the New York Times. The unofficial retirement age for the newspaper's leader was 65 for Baquet, who led the newsroom for 8 years. Kahn is likely to stay for 8 years.

Smith spoke with Kahn about his plans for a newspaper that is on sounder financial footing than almost any news organization in the world.

The No. 1 song in the world is…

It has been the top song on the streaming service for two weeks in a row.

Deals, deals, deals

Weekly playlist

I put together a list of my favorite songs from recent live shows. Parquet Courts, a rock band that takes me back to the late 90s and mid-aughts, did not perform their song "Watching Strangers Smile". Think of Dandy Warhols, the Strokes, etc.