Ted Sarandos Said He ‘Screwed Up’ on Transgender Debate

Netflix c0-CEO and chief content officer Ted Sarandos says he “screwed up” handling the controversy regarding stand-up comic Dave Chappelle’s new Netflix special “The Closer” — now streaming on the SVOD platform.

Chappelle, who has a long-term contract with Netflix, drew criticism from LGBTQ groups over comments he made regarding transgender people, remarks some observers — including Netflix’s transgender employees — viewed as hurtful and discriminatory.

The streamer’s trans employee resource group has a planned Oct. 20 virtual walkout in protest.

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In an Oct. 19 media interview, Sarandos said he should have realized that initial comments supporting freedom of speech and “artistic expression” could hurt some people.

“I 100% believe that content on screen can have impact in the real world, positive and negative,” he said. “I should have first and foremost acknowledged in those [company memos] that a group of our employees were in pain, and they were really feeling hurt from a business decision that we made.”

Sarandos said the internal memos, one of which was leaked to the media resulting in the firing of the Netflix employee who leaked it, were clumsily handled. That said, the CCO said there were no plans to pull Chappelle’s special (which ranks No. 3 on the platform), arguing there would always be content on Netflix that would offend some audiences.

“We’re deeply committed to the culture of transparency [within Netflix],” Sarandos said. “It also depends upon a great deal of trust with our employees that we continue to secure, but we don’t plan on changing any of our internal operations around that.”

Ted Sarandos: Netflix Management Wasn’t Sold on ‘Squid Game’ in the Beginning

With South Korean original horror series “Squid Game” setting viewership records for Netflix, it would be easy for co-CEOs Reed Hastings and Ted Sarandos to take credit for a show 142 million Netflix households streamed in the first 28 days following its Sept. 17 debut.

Speaking on the Oct. 19 webcast, Sarandos gave credit to the streamer’s South Korean team that recognized the show’s potential when acquiring the rights two years ago. It was not a sentiment equally shared stateside.

“I can’t say that we had the same eyeball on it that it was going to be the biggest title in our history around the world,” Sarandos said.

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The executive said that the show tracked like a local language show that mushroomed globally. At the same time, he said predicting the success of a program is unrealistic.

“In 10 years trying to sell [‘Squid Game’], our team recognized something nobody else did. And created an environment for that creator to make a great show,” Sarandos said. “How something can go viral is really hard to predict, but it’s super powerful when it happens.”

The co-CEO said “Squid Game” has been able to “deliver the goods” to be able and attract monster viewership, and have people talk about it in shorthand.

“Sometimes you think you have lightening in a bottle and you’re wrong,” Sarandos said. “And then you have a really great Korean show that happens to be lightening in a bottle for the rest of the world.”

The CFO was quick to point out that Netflix has had similar successes, just not on the same scale as “Squid Game.” Shows such Spain’s Money Heist, France’s “Lupin,” Germany’s Blood Red Sky and the U.K.’s “Sex Education,” among others.

Sarandos said Netflix’s content team continually focus on the reality that stories of the world increasingly come from all over the world — not just Hollywood. He said non-English language content viewing has grown three times since Netflix began making original programming in 2008.

“The thing [our content teams are] mostly focused on are a bunch of shows you’ve never heard of, but are hugely impactful in [different] territories, like Denmark, Italy and India,” Sarandos said. “These are all shows that are meant to be hugely impactful and loved in territory, and if they really catch on, they travel a lot.”

Ted Sarandos Defends Comic Dave Chappelle Over Controversial Netflix Special

Netflix co-CEO and chief content officer Ted Sarandos is defending the streamer’s decision to keep “The Closer,” an original new stand-up special featuring comic Dave Chappelle on the platform. The program has drawn protests regarding Chappelle’s comments about the transgender community.

Specifically, Chappelle, in the special, defends “Harry Potter” author J.K. Rowling, who has criticized transgenders and claimed they represent a threat to her own gender identity.

“They canceled J.K. Rowling – my God,” Chappelle says on the program. “Effectually she said gender was a fact, the trans community got mad as [expletive], they started calling her a TERF [“trans exclusionary radical feminist”] … I’m Team TERF. I agree. I agree, man. Gender is a fact.”

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In an Oct. 8 staff memo, Sarandos reportedly said Chappelle is known for controversial comments — and generating lots of viewers. Netflix’s previous Chappelle special (the fifth under a long-term deal), “Sticks & Stones,” was one of the “stickiest” stand-up specials, according to the executive.

“Several of you have asked where we draw the line on hate,” Sarandos wrote. “We don’t allow titles on Netflix that are designed to incite hate or violence, and we don’t believe ‘The Closer’ crosses that line.”

Sarandos said he understands that distinguishing between commentary and harm is difficult, especially with stand-up comedy, which exists to push boundaries.

“Some people find the art of stand-up to be mean-spirited, but our members enjoy it, and it’s an important part of our content offering,” he wrote.

Ted Sarandos: Netflix Streaming Data a ‘Big Black Box’

Ever since Netflix began divulging the number of subscribers and time spent streaming original series and movies, data dumps by the SVOD behemoth would suggest viewership is through the roof.

It just depends how high, and how big, the roof is.

Speaking Sept. 27 at the Code 2021 conference in Beverly Hills, Calif., co-CEO/chief content officer Ted Sarandos presented updated numbers on the streamer’s most popular series and movies.

Shonda Rhimes’ adaptation of Victorian England in the first season of “Bridgerton” was the No. 1 series in terms of both viewership by subscriber households (82 million) and subscriber time (625 million hours). Actioner Extraction, with Chris Hemsworth, was streamed by 99 million households, while Sandra Bullock dystopian thriller Bird Box snared 282 million hours.

While the numbers are huge, Sarandos admitted the data is a bit of “a big black box.” Indeed, Netflix counts a viewer after just 120 seconds of continuous streaming — leaving actual viewership a bit of a guessing game. The streamer ended the most-recent fiscal period (ended June 30) with almost 210 million subscribers worldwide.

Sarandos said that while viewership data was not the lone factor Netflix used determining a show’s lifeline, he added that “for a subscription business, engagement really matters. This is a real indicator of value.”

Indeed, Sarandos said the new Korean horror series, “Squid Game,” is currently the most-streamed series on the platform since its Sept. 17 launch, tracking to become one of the top series ever streamed on Netflix.

“We did not see that coming, in terms of its global popularity,” Sarandos said.

Netflix Acquires Roald Dahl Story Company

Three years after forming a partnership for original animated TV series, Netflix Sept. 22 announced it is purchasing the Roald Dahl Story Company for an undisclosed amount. The prolific British novelist, short-story writer, poet and screenwriter died in 1990 at the age of 74.

Netflix currently has Academy Award winning director Taika Waititi and Oscar nominee Phil Johnston working on a series based on Charlie and the Chocolate Factory. In addition, Netflix  is working with Sony Pictures and Working Title on an adaptation of Matilda The Musical.

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“These projects opened our eyes to a much more ambitious venture — the creation of a unique universe across animated and live-action films and TV, publishing, games, immersive experiences, live theater, consumer products and more,” Ted Sarandos, co-CEO and chief content officer, and Luke Kelly, managing director of RDSC and Dahl’s grandson, wrote in a blog post.

Dahl’s books have been translated into 63 languages and sold more than 300 million copies worldwide, with characters such as Matilda, The BFG, Fantastic Mr. Fox, Willy Wonka and The Twits, among others.

“As we bring these timeless tales to more audiences in new formats, we’re committed to maintaining their unique spirit and their universal themes of surprise and kindness, while also sprinkling some fresh magic into the mix,” Sarandos and Kelly wrote.

Completion of the transaction is subject to regulatory approvals and other customary closing conditions.

Reed Hastings: Linear TV, YouTube Biggest Netflix Competitors — Not Disney+

Following a quarter in which global subscriber growth failed to meet internal and market projections, Netflix executives found themselves on the defensive explaining why 43% fewer subs signed up for the service than expected.

Speaking on the investor webcast, CFO Spencer Neumann said COVID-19 skewed the playing field as the record subscription growth from a year ago could not be replicated — also due in part to production of new content coming to a halt for much of 2020.

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“The combination of those two things does create some noise,” Neumann said, adding that when removing the pandemic from the equation, Netflix sub growth over the past two years has increased more than 20%.

“So, the business remains healthy and that’s because the long-term drivers, this big transition from linear-TV to streaming entertainment, remains as healthy as ever,” he said.

Co-founder/co-CEO Reed Hastings said Netflix’s biggest competitors for viewing time remain linear TV and YouTube — with the latter considerably larger than Netflix in viewing time.

“Disney [viewing time] is considerably smaller,” Hastings said.

He said Netflix remains preoccupied with subscriber satisfaction, retention, and word of mouth, which Hastings said drives sub growth.

The executive said Netflix’s goal remains finding stories subscribers can connect with, improving content selections, the best recommendations, and then ultimately, stories that are incredibly compelling.

“We are just quarter-by-quarter, learning more lessons on each one of those which is what improves the member satisfaction, which is what really drives the growth,” he said.

“We have been competing with Amazon Prime Video for 13 years, with Hulu for 14 years,” he said. “It’s always been very competitive with linear TV, too. So there is no real change that we can detect in the competitive environment. It’s always been high and remains high.”

Separately, COO/CPO Greg Peters said the streamer remains upbeat on video games, which is rolling out with interactive children’s programming and the 2018 original movie Bandersnatch.

“We’re going to continue working in that space for sure,” Peters said. “We’ve actually launched games themselves. It’s part of our licensing and merchandising effort, and we’re happy with what we’ve seen so far. And there is no doubt that games are going to be an important form of entertainment and an important sort of modality to deepen that fan experience. So we’re going to keep going, and we will continue to learn and figure it out as we go.”

Reed Hastings Sells $225 Million in Stock Options; Now 120th Richest Person in the U.S.

Christmas came early to Netflix co-founder/co-CEO Reed Hastings. The executive face of the subscription streaming video pioneer sold $225 million in stock options, according to a Dec. 22 regulatory filing. Hastings, who owns $2.6 billion in Netflix stock, sold $103 million worth of stock options in November. He sold another 83,000 shares on Dec. 8. In 2020, Hastings, who relinquished half of his CEO title to CCO Ted Sarandos, has sold $616 million in stock.

Bloomberg reported that 60-year-old Hastings increased his wealth by $2.2 billion in 2020, to $6.4 billion, making him the 120th richest person in the country. The increase was in part due to a 63% increase in the stock’s price, and the addition of more than 28 million subscribers. Netflix ended its most-recent fiscal period with 195 million subs worldwide.

Interestingly, Roku founder Anthony Wood, a former Netflix executive who helped launch the SVOD market in 2007 with a branded Netflix streaming player, saw his personal wealth reach $7 billion in 2020, due to the company’s stock skyrocketing 165% this year.

Hastings’ sell-off mirrors other Netflix corporate executives looking to exercise stock options before the end of the fiscal year for tax purposes. Interestingly, Sarandos has mostly acquired shares of the streamer in recent months. Netflix has a market capitalization approaching $230 billion.

 

Netflix Bosses Say Series Cancellations on Par With Industry Standards

Netflix has gained a reputation in recent years for pulling the plug on a higher number of original series compared with other streamers and TV networks. Speaking Nov. 11 at the 25th annual Paley Center International Council Summit, Netflix co-CEO Ted Sarandos and Bela Bajaria, head of global TV, called the characterization misleading as the streamer goes to market with full first-seasons compared with pilots at the networks.

Bajaria said Netflix’s original program legacy offering all episodes of series upfront lends itself to determining whether a program has legs to run beyond the first season. Bajaria did not reveal the analysis involved in determining when a show gets cut.

“It’s always painful to cancel a show, and nobody wants to do that,” she said.

The streamer this year decided not to greenlight second seasons of space drama “Away,” “Teenage Bounty Hunters,” “Spinning Out,” “AJ and the Queen,” “Messiah,” “Ashley Garcia: Genius in Love,” “October Faction,” “V Wars,” “I Am Not Okay With This” and “The Society,” among others

Meanwhile, Netflix ordered a second season of “Emily in Paris,” the former Paramount content licensed to Netflix over the summer. It ranks among Netflix’s Top 10 streamed shows, according to Nielsen. It also approved a third season of superhero show “The Umbrella Academy,” and a second second season of “Raising Dion,” about a widowed mom who sets out to solve the mystery surrounding her young son’s emerging superpowers while keeping his extraordinary gift under wraps.

“We actually have a renewal rate of 67%, which is [the] industry standard,” Bajaria said.  “You have to look at ‘The Crown,’ with season four launching now, ‘Grace & Frankie’ and ‘The Ranch,’ we’ve had long-running shows and we’re always going to have a mix that are great to be told in a limited series form and shows that go on for multiple seasons.”

Sarandos contends that Netflix’s high profile results in news being made whenever the streamer cancels a program. The veteran CCO said the old TV business model of hoping a series reached 100 episodes or four seasons to qualify for syndication are over.

“I think many shows can be a success for being exactly what they are and you could tell that story in two seasons or one season or five seasons,” Sarandos said. “I think it gets talked about so much because [we are] measured against the old way of doing things.”

Ted Sarandos: ‘Cuties’ Is a ‘Very Misunderstood’ Film

Netflix is facing a criminal indictment in the state of Texas regarding allegations of “lewd visual material” involving underage girls in the French indie film Cuties. Speaking Oct. 12 at the French virtual MIPCOM confab, co-CEO Ted Sarandos defended the movie about an 11-year-old Senegalese girl coming of age in 21st century Paris against the backdrop of a religious mother and peer pressure from a group of young female dancers.

“It’s a little surprising in 2020 America that we’re having a discussion about censoring storytelling,” Sarandos told the confab. “It’s a film that is very misunderstood with some audiences, uniquely within the United States.”

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Sarandos, who shares CEO duties with Netflix co-founder Reed Hastings, said the streamer has no plans to alter the movie to appease critics. He said the film, which Netflix acquired at the Sundance Film Festival, amounts to an autobiography of sorts for director Maïmouna Doucouré.

“The film speaks for itself,” he said. “It’s a very personal coming of age film, it’s the director’s story and the film has obviously played very well at Sundance without any of this controversy and played in theatres throughout Europe without any of this controversy.”

GOP Senators Question Netflix’s Planned Chinese-Based Sci-Fi Series

A group of Republican senators has sent a letter to Netflix co-CEO Ted Sarandos questioning why the SVOD behemoth plans to adapt Chinese sci-fi trilogy “A Three-Body Problem” by author Cixin Liu into an original series. “Game of Thrones” creators David Benioff and D.B. Weiss have been tasked with creating the series for Netflix about humanity’s first contact with an alien civilization.

Liu is also author of the short story upon which Chinese sci-fi theatrical hit The Wandering Earth is based. The movie, which has topped Mulan in theatrical revenue, has generated more than $690 million at the Chinese box office. Netflix acquired SVOD rights to the movie for North America, Australia, New Zealand and South Korea.

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Senators Marsha Blackburn (R-TN), Kevin Cramer (R-ND), Martha McSally (R-AZ), Rick Scott (R-FL) and Thom Tillis (R-NC) contend Liu is sympathetic to Chinese government’s forced re-education of ethic Uyghur Muslims in the Xinjiang region.

The Uyghur Muslims have become political pawns for the Trump Administration and its allies in Congress seeking leverage in the government’s ongoing trade disputes between Beijing and Washington, D.C.

Earlier this month, Sen. Josh Hawley (R-MO) took to social media, accusing Disney of “whitewashing genocide” by allegedly cooperating with Chinese police working at the Uyghur camps, including crediting them in the live-action Mulan movie credits. Disney CFO Christine McCarthy said it was common practice in Hollywood to acknowledge local governments for a movie filmed abroad.

In the Sept. 23 letter to Sarandos, the senators are seeking answers to the following questions:

  1. Does Netflix agree that the Chinese Communist Party’s interment of 1.8 to 3 million Uyghurs in internment or labor camps based on their ethnicity is unacceptable?
  2. LWere Netflix senior executives aware of the statements made by Mr. Cixin liu regarding the Chinese Communist Party’s genocidal acts prior to entering into an agreement to adapt his work? If so, please outline the reasoning that led Netflix to move forward with this project. If not, please describe Netflix’s standard process of due diligence and the gaps therein that led to this oversight.
  3. Does Netflix have a policy regarding entering into contracts with public-facing individuals who, either publicly or privately, promote principles inconsistent with Netflix’s company culture and principles? If so, please outline this policy. If not, please explain why not.
  4. In order to avoid any further glorification of the CCP’s actions against the Uyghurs, or validation of the Chinese regime and agencies responsible for such acts, what steps will Netflix take to cast a critical eye on this project – to include the company’s broader relationship with Mr. Liu?

 

A Netflix representative was not immediately available for comment.