Netflix sacks 150 staff amid mounting pressure

Under pressure on multiple fronts, Netflix has laid off more than 200 full-time and part-time staff in an effort to cut costs.

Netflix has embarked on a sacking spree, axing 150 full-time and 70 part-time staff.

The streaming company has been aggressively cutting costs after it revealed in its last financial report a declining subscriber base. Netflix’s stock price has plummeted 68 per cent since the beginning of the year, wiping tens of billions off its market value.

The 150 full-time employees who lost their jobs represent 2 per cent of its US workforce, according to The New York Times. Deadline reported the eliminated positions are mostly in its creative ranks, including people in executive and director ranks working on original titles.

“As we explained [in reporting Q1] earnings, our slowing revenue growth means we are also having to slow our cost growth as a company,” Netflix said in a statement to Variety. “So sadly, we are letting around 150 employees go today, mostly US-based.

“These changes are primarily driven by business needs rather than individual performance, which makes them especially tough as none of us want to say goodbye to such great colleagues. We’re working hard to support them through this very difficult transition.”

The 70 part-time positions, according to Variety, are in the company’s animation department, which had already one month earlier lost its director of creative leadership and development Phil Rynda, as well as several other team members.

The animation arm has also suffered a number of cancelled projects which were still in development, including a long-germinating adaptation of Jeff Smith’s Bone graphic novels, Meghan Markle’s show Pearl and Ava DuVernay’s Wings Of Fire.

Other series that have been cancelled in recent weeks include Space Force, Raising Dion and Pretty Smart.

The other significant casualty of Netflix’s scythe is the team for Netflix’s editorial project Tudum, an offshoot, fan-targeted site which covers the behind-the-scenes of Netflix originals.

A raft of Tudum staffers, many only recently recruited, were sacked in the first round of firings as part of a wider cull of its marketing department while The Verge reported 26 contractors working on Tudum lost their jobs today.

The company last week sent out a staff memo which warned that employees who didn’t like or approve of some of Netflix’s titles – referencing the internal rancour over transphobic comments made by Dave Chappelle in his comedy special – should consider working elsewhere.

Netflix’s drastic moves to rein in costs follow a dramatic few months at the streaming giant. Netflix is under significant financial pressures after it revealed its growth trajectory had not only stopped but had gone backwards.

The company posted a decline of 200,000 subscribers for the first three months of this year – its first tumble in a decade – and flagged it expected to lose a further 2.5 million in the current quarter. Netflix attributed 700,000 of the membership losses to pulling out of Russia.

Its earnings report immediately plunged the company’s stock value as investors sold off their shares.

In an attempt to buffer the damage, Netflix executives, including founder and co-chief executive Reed Hastings said the streamer would introduce a cheaper, advertising-supported membership tier. Hastings had previously ruled out any such move.

While no streaming platforms in Australia offer a lower-cost subscription option that’s offset by advertising, it’s a popular model in the US afforded by HBO Max, Hulu, Paramount+ and Peacock.

Typically, the ad-supported option costs half of that of an ad-free subscription.

Disney has said it will introduce an ad-supported tier on its streaming service. Today it confirmed it would not accept advertising from alcohol brands or political parties.

Neither Disney nor Netflix has confirmed if the ad-supported membership options will be rolled out globally.

Netflix will also crack down on password sharing, a practice in which 100 million of its 222 million members engage. Netflix has been trialling a feature in Peru, Costa Rica and Chile in which subscribers are able to legitimately share their password beyond their household for an extra fee, between $3 to $4 per month.

The ad-supported option and password crackdown is expected to be live before the end of the year.

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