More than eight months after it dropped on Netflix, internal dissent over the controversial Dave Chappelle comedy special The Closer continues to roil Netflix’s famously innovative company culture, with staffers now lamenting that the notoriously open communication lines between upper management and the lower ranks have been permanently severed. 

“Today, as a manager, we can’t speak up in content or studio teams, and what Ted [co-CEO Ted Sarandos] says goes,” wrote one Netflix manager in the anonymous employee forum Blind. “Very top-down culture and even when we raise the problems we see early on in our shows, our voices are not heard.”

The post was highlighted in a feature story running across Vox Media outlets Thursday, outlining a shift in Netflix company culture away from the “radical transparency” described in the company’s groundbreaking 2009 “Culture Memo.” 

The Vox story describes a longstanding Google doc at Netflix, on which employees from any rank and any department were encouraged to volley any type of concern or feedback they wished. Co-CEO Reed Hastings, known for “taking criticism on the chin,” was reputedly quick to respond earnestly to this feedback. 

Creative teams were also encouraged to reach out to employee resource groups (ERGs) to get feedback on a potentially sensitive topic. That was the case in 2018, when the “Trans* ERG” was asked to review a screening of the Cannes acquisition Girl. The “horrified” group staunchly objected to key scenes in the Caméra d’Or-winning film. The Trans* ERG wasn’t able to stop Netflix’s release of Girl, but it was reportedly satisfied that Netflix managers agreed to include a content warning. 

This exchange reportedly worked well. Beyond Netflix’s notably high salaries, it provided an important morale wellness tool amid a competitive environment for, say, software engineers, at a time when competitors including the erstwhile WarnerMedia and HBO Max sure could have used some better coding help. 

But the system reportedly broke down in the run-up to the October 5 release of The Closer. 

After an internal briefing was published that outlined numerous red flags associated with the standup special, the Google doc filled with pointed questions: “If we can measure an appetite from members for transphobic and bigoted content, will we start partnering with dangerous celebrities, actors, and comedians who are intentionally divisive (Owen Benjamin, Alex Jones, Ann Coulter) in an effort to ‘entertain the world?‘ ” wrote one poster. 

This time, however, an earnest response from Netflix upper management wasn’t so quickly forthcoming. 

The company’s response might best be outlined by the changes made to its Culture Memo in May, when this clause was put in: “As employees, we support the principle that Netflix offers a diversity of stories, even if we find some titles counter to our own personal values. Depending on your role, you may need to work on titles you perceive to be harmful. If you’d find it hard to support our content breadth, Netflix may not be the best place for you.”

In the aftermath, the Vox story laments, the provocative conversations about Netflix culture and politics are occurring in forums like Blind, where users can post in the Netflix forum as long as they have the right Netflix corporate email address. 

This dialogue, however, no longer appears on the Google doc, which has become a “another venue for Netflix executives to post platitudes.” ▪️

So, Netflix had a pretty good quarter, punctuated by a really bad week. 

It’s always bracing to see a giant corporation at the forefront of the entertainment industry stumbling through life’s painful dualities. It’s kind of reassuring to see that we’re all fallible, as humans and as organizations composed of humans. The question is whether the really bad week or the pretty good quarter will matter more to this particular organization in the long run.

Also read: Sarandos' 'The Closer' Apology Tour 'Misses the Point,' Fired Employee Says

Third quarter earnings were announced after market close on Tuesday, with subscriber growth about 25% higher than forecast, some 4.4 million adds, with a forecast to add 8.5 million more this quarter.

During the earnings call, Netflix execs pronounced themselves largely pleased with an increasingly strong quarter boosted by the thunderous arrival of all-time most-watched show Squid Game, out of Korea, along with strong showings by Spain’s La Casa de Papel, Denmark’s The Chestnut Man, and Britain’s Sex Education, and a record-tying sheaf of Emmy wins for shows such as The Crown and The Queen’s Gambit.

Furthermore, the success of those mostly international shows provided an emphatic endorsement of Netflix’s global strategy. As for the rest, well, it was pretty good.

“Really it boils down to it's sort of what we expected,” said CFO Spence Neumann during Tuesday afternoon’s earnings call. “We’re getting toward the tail end of the COVID choppiness. Throughout the quarter, the business remained healthy, at churn levels below 2020. Retention was healthy. Viewing was up, healthy, compared to 2019.” 

After the ho-hum earnings call, co-CEO Ted Sarandos turned to a considerably more fraught set of conversations, with Hollywood trade publications, trying to walk back previous ill-received messaging about another of Netflix’s most-watched shows, comedian Dave Chappelle’s special The Closer. 

“I screwed up,” Sarandos said, in full damage-control mode. He should have “led with more humanity” acknowledging the pain of some company employees, while also making a “blanket statement that didn’t land as it was intended.” 

Sarandos went on, “We are trying to support creative freedom and artistic expression among the artists that work at Netflix. Sometimes, and we do make sure our employees understand this, because of that—because we’re trying to entertain the world, and the world is made up of folks with a lot of different sensibilities and beliefs and senses of humor and all those things — sometimes, there will be things on Netflix that you dislike. That you even find to be harmful. Where we’ll definitely draw the line is on something that would intentionally call for physically harming other people or even remove protections. For me, intent to cause physical harm crosses the line, for sure.”

It wasn’t enough to calm down an increasingly noisy and polarizing situation.

Chappelle is a professional excrement stirrer, a remarkable and ground-breaking comedian and social observer who also has a terrible history of problematic-to-bigoted comments about LGBTQ+ people. Even as Chappelle has proven to be an incisive comedic explorer of the challenges Black people face in a frequently racist society, he has failed to examine his own limitations when talking about another set of people with nearly as thorough a history of pain and exclusion. 

Trans people and their allies took umbrage at Chappelle’s latest crummy remarks about them, and pushed to have the show taken off the service. Sarandos tried to differentiate between offensive speech and the artistic license that society still, haphazardly, grants to comedians. 

His careful line drawing didn’t play well, fueling outright mutiny in some corners of Netflix, and countless hot takes by outsiders. 

One worker leaked financial data about The Closer, and was fired. At least three other protesting workers were suspended after crossing one or another corporate line. 

Then on Wednesday, trans employees and their allies took part in a protest outside Netflix’s Hollywood production headquarters, again pushing for Chappelle’s show to go, while promising to push for company support of a list of other “firm asks.” 

The fight doesn’t seem likely to abate soon. The implications are significant not just for Netflix but for any media or technology company reaching a global audience (and the creators for those audiences), without enraging long-abused and -overlooked constituencies who are increasingly finding their voices. 

Alphabet CEO Sundar Pichai said this week at a tech conference that he and other CEOs are navigating “a new normal” where employees expect to be able to express concerns when the company doesn’t live up to their values.  

“CEOs need to embrace the fact that in the modern workplace, people want to have a say in things too,” Pichai said. “They have to embrace that and see that as a strength.”

Encouraging that kind of two-way communication “brings accountability,” Pichai said. The company has invested in new channels to allow people to provide that feedback. “But we’ve also been more focused on explaining what we’re doing.” 

That doesn’t mean Alphabet has walked the line perfectly. Just this past year, it’s fired at least two artificial-intelligence researchers who raised ethical concerns with the company’s work. 

ViacomCBS CEO Bob Bakish also talked at the same conference about empowering employees while striving to reach a broad array of audiences. 

“For companies at scale, serving people all over the world, there will inevitably be content that some people love and others don’t,” Bakish said, alluding to controversy last year when former ViacomCBS division Simon & Schuster agreed to publish former Vice President Mike Pence’s book. “You're going to run into some of these issues. You have to manage them with finesse. Sometimes there’s something you have to pull (from the market). We've been there before and unfortunately, we’re probably going to be there again.”

Like Pichai, Bakish counseled “lots of communications” with staff. ViacomCBS relies on monthly town halls and regular staff surveys, among other communications channels.

“People give their points of view, and that's OK,” Bakish said. “Ultimately we have to make decisions, but we believe fundamentally there should be communications, and open communications.”

But just encouraging two-way conversations isn’t enough. An Explorance study of 2,000 workers found one big reason why people are leaving their jobs during the so-called Great Resignation: “feedback that goes unheard.” 

“The survey found that a majority of employees are eager to share feedback with employers and do so in the hopes of driving positive change in their workplace,” according to an Inc. story about the study. “However, employees--including many executives--feel that all too often their feedback goes unheard and does not result in meaningful change.”

That suggests Netflix has stumbled across treacherous territory if it handles this controversy badly. 

Other parts of Hollywood are actively supporting and even courting trans creators. The Sundance Institute, for instance, just launched an intensive workshop for “transgender storytellers of color.”  Dramas about the sometimes-lethal bigotry and other challenges facing trans people are increasingly common. Even Netflix has an official employee group for its trans workers. 

Netflix has long prided itself on a unique culture of “radical openness,” encouraging frank and constant internal feedback and criticism. When you foster that environment, you have to respond to it, or lose credibility and access to talent, within the company and with creators who no longer are willing to work with you. It can also impact how audiences see your company, and whether they choose to turn from your network to someone else’s. 

It’s impossible to say whether Netflix’s really bad week will have that kind of long-lasting impact. But it’s going to be something to watch closely as Sarandos et al navigate one of their biggest challenges yet. 

Netflix Co-CEO Ted Sarandos expressed regret for words he used to address staff last week, following the controversy created by comedian Dave Chappelle's latest standup special, The Closer. 

But a recently fired Netflix employee, who organized a Wednesday staff walkout in protest of the company's handling of the Chappelle matter, said Sarandos' mea culpa missed the mark. 

"Ted still misses the point, this isn’t about the special or taking it down. It’s about parity in content. All we asked for was more trans content, investment in trans talent, and promoting trans content," tweeted B. Pagels-Minor, a former Netflix senior product manager who was fired last week for allegedly leaking financial data about Netflix shows 

On Tuesday, as Netflix was delivering its buoyant third-quarter earnings report, Sarandos embarked on a kind of apology tour, delivering separate but barely distinguishable Q&As for Penske Media's veritable monopoly of Hollywood trade pubs (which includes Variety, Deadline and The Hollywood Reporter), as well as The Wall Street Journal. 

"Obviously, I screwed up that internal communication. I did that, and I screwed it up in two ways," Sarandos told Variety. 

"First and foremost, I should have led with a lot more humanity," Sarandos said in his Variety interview. "Meaning, I had a group of employees who were definitely feeling pain and hurt from a decision we made. And I think that needs to be acknowledged up front before you get into the nuts and bolts of anything. I didn’t do that. That was uncharacteristic for me, and it was moving fast and we were trying to answer some really specific questions that were floating. We landed with some things that were much more blanket and matter-of-fact that are not at all accurate.

"Of course storytelling has real impact in the real world," Sarandos added, walking back his earlier comment. "I reiterate that because it’s why I work here, it’s why we do what we do. 

Earlier, in leaked company memos, Sarandos said controversial jokes made by Chappelle in The Closer targeting the trans community don't cause "real world harm." The co-CEO's terminology did little to quell growing dissent within Netflix among LGBTQ staff members, one of whom was fired last week for allegedly releasing data to the press in an effort inspired by opposition to The Closer.

That employee, later identified as veteran Silicon Valley technologist and self-described "thought leader" Pagels-Minor, helped Wednesday's Netflix staff walkout at the company's Hollywood location. Participating staff members were met by what were reportedly dozens of LGBTQ-supporting protesters and Chappelle-backing counter-protesters on Vine Street, outside the Netflix Hollywood headquarters. 

Reuters captured video of the event below:

For his part, Pagels-Minor has conceded to having accessed the data in question, which shows Netflix paying over $20 million for recent Chappelle comedy specials, but getting back little economic value compared to other recent Netflix titles. Pagels-Minor, however, denies having leaked the data.

Before Wednesday's walkout, Netflix released this statement: “We value our trans colleagues and allies, and understand the deep hurt that’s been caused. We respect the decision of any employee who chooses to walk out, and recognize we have much more work to do both within Netflix and in our content.”

At least one Bothan got fired to bring us this information...

Netflix paid $21.4 million for local-language limited series sensation Squid Game, but will end up with content it values at around $891 million, based on the streaming company's proprietary financial metrics. 

The data comes courtesy of Bloomberg, which appears to have obtained it from a since-fired, internal Netflix source. 

Unless you're living in North Korea, you probably already know that nine-part South Korean, dystopian-themed limited series Squid Game just yielded Netflix's largest first-28-days global audience ever. 

Also Read: 'Squid Game' Shatters Netflix's 28-Day Viewership Record

Netflix doesn't sell advertising against its content, or otherwise directly attach revenue to specific shows. But the company has a proprietary measurement it calls "impact value" to assess the worth of its movies and TV shows. 

Also Read: 'Squid Game,' Netflix's Latest Inexplicable Hit (Review)

Thanks to a Netflix company "Culture Memo" philosophy that attempts to treat every employee like an adult deserving of basic human dignity, we now know this ... and some other things.

The basic tenet of Netflix culture and its so-called "radical transparency" is that every employee may have access to sensitive company data, but they won't share it with Bloomberg because the prime directive is to serve Netflix. 

In this case, the unnamed, since-terminated employee seems to have chosen another prime directive, tied to another well-publicized piece of Netflix content: comedian Dave Chappelle's latest, most-controversial-of-all standup specials, The Closer. 

Specifically, he/she allegedly leaked financial data on three other titles, besides Squid Game, according to the Bloomberg article:

> The Closer, which the leak said costs Netflix $24.1 million

> Chappelle's 2019 standup special Sticks & Stones, which the leaked docs said costs $23.6 million but had an impact value of only $19.4 million for an "efficiency score" of 0.8 (another Netflix proprietary performance metric).

> Comedian Bo Burnham's standup special Inside, which the leak said costs $3.9 million but generated an efficiency score of 2.0. 

The leak, Netflix said, was in response to Netflix's publishing -- and subsequent backing by upper management -- of The Closer, which members of the LGBTQ community vehemently claim contains dangerous anti-trans messages. 

This dissent has included the ranks of Netflix employees, three of whom were temporarily suspended for crashing a Netflix PR strategy meeting they weren't invited to. 

“We have let go an employee for sharing confidential, commercially sensitive information outside the company,” a Netflix spokesperson said in a statement. 

“We understand this employee may have been motivated by disappointment and hurt with Netflix, but maintaining a culture of trust and transparency is core to our company," the statement added. 

Netflix Co-CEO Ted Sarandos has released a second company-wide memo in less than a week, again defending the streaming service's decision not to pull or alter comedian Dave Chappelle's latest standup special, The Closer, following outrage from the transgender community. 

Also read - Netflix's Sarandos Defends Chappelle's 'Closer': 'We Work Hard to Support Creative Freedom'

“Chappelle makes harsh jokes about many different groups, which is his style and a reason his fans love his comedy and commentary,” Sarandos wrote in an email, which was first intercepted and reported by Variety. “Stand-up comedians often expose issues that are uncomfortable because the art by nature is a highly provocative. As a leadership team, we do not believe that The Closer is intended to incite hatred or violence against anyone."

Sarandos also said that The Closer causes no "real world harm.

“The strongest evidence to support this is that violence on screens has grown hugely over the last 30 years, especially with first party shooter games, and yet violent crime has fallen significantly in many countries,” Sarandos added. “Adults can watch violence, assault and abuse—or enjoy shocking stand-up comedy—without it causing them to harm others.”

Netflix has faced criticism, both internally and externally in places like Twitter, for its decision to drop Chappelle's latest special, in which he uses pointed jokes to highlight claims of hypocrisy and other issues within the LGBTQ community. 

Earlier this week, Netflix suspended three employees for crashing a virtual meeting to discuss the PR crisis, only to reinstate them based on the fact that their intentions were allegedly pure. 

Now, one of those employees, software engineer Tera Field, is among a number of transgender Netflix staffers planning to walk off the job next week. 

Meanwhile, transgender writer-producer Jaclyn Moore, the creative force behind Netflix's Dear White People, said she will no longer work for Netflix.

However, in an earlier staff email, Sarandos lauded the popularity of The Closer and other Chappelle comedy specials, noting that Netflix intends to keep working with the comic. In fact, according to leaked company data, Chappelle's latest special was watched by 10 million accounts within its first week on the service. 

Netflix has suspended three employees, including an outspoken trans staffer, for allegedly hacking into a virtual meeting to which they were not invited. 

Terra Field, a senior software engineer for the streaming company based in San Francisco, and two other Netflix employees, allegedly found their way into a virtual meeting among Netflix executives, intended to address how the company should respond to a heated controversy tied to the latest Dave Chappelle standup special, The Closer, which dropped last week. 

Field had tweeted her unease about the special on Oct. 6:

“It is absolutely untrue to say that we have suspended any employees for tweeting about this show,” Netflix said in a statement. “Our employees are encouraged to disagree openly and we support their right to do so.”

Meanwhile, the meeting seems to have gestated a communications strategy, evidenced by this leaked company memo from Netflix Co-CEO Ted Sarandos:

“Chappelle is one of the most popular stand-up comedians today, and we have a long standing deal with him," Sarandos told Netflix staff. "As with our other talent, we work hard to support their creative freedom — even though this means there will always be content on Netflix some people believe is harmful, like Cuties, 365 Days, 13 Reasons Why or My Unorthodox Life.

“Several of you have also asked where we draw the line on hate," Sarandos added. "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,” he added. “I recognize, however, that distinguishing between commentary and harm is hard, 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.”

The Closer is the culmination of a six-special, $120 million deal that Chappelle signed with Netflix back in 2016. 

The provocative comedian has steadily heated the dialog between himself and the LBGTQ community over the course of this work. And The Closer has taken a back-and-forth, previously arbitrated mainly over Twitter, to another level, with trans supporters complaining that Chappelle's latest work is less about artful comedic expression than it is dangerous, divisive and hurtful rhetoric.  

This isn't the first time that Sarandos has backed Chappelle in a dispute. In December, Netflix pulled its off-net run of Chappelle's Show, after the comedian complained loudly that owner ViacomCBS was licensing the repeats based on an exploitive deal it made with the comedian at a time he had little leverage. 

ViacomCBS and Chappelle have since settled the rift, and Netflix has restored the episodes. 

Longtime Turner programming executive Michael Wright is switching from the small to the big screen.

It didn’t take Wright -- who has been serving as president and head of programming for TNT, TBS and Turner Classic Movies -- long to find a new gig, as he was named CEO of DreamWorks Studios. Wright, who has not worked in theatricals, will succeed outgoing DreamWorks CEO Stacey Snider. He will start his new gig on Jan. 3, 2015.

“I have had the pleasure of working alongside Michael for many years and have come to know him as a talented executive whose creative vision, leadership, and passion are a perfect fit for our company,” said DreamWorks chairman Steven Spielberg, to whom Wright will report. “He has a keen understanding of storytelling and how to deliver those stories in every shape and size, regardless of platform. I am delighted to welcome him to DreamWorks Studios.”

Miniseries Into the West and drama Falling Skies emanated at Amblin and then onto TNT's air. The studio, working in conjunction with TNT Original Productions, is slated to premiere Public Morals on the service next year. 

Turner announced last week that Wright, a 12-year veteran of the company, would depart. The company has initiated voluntary buyouts and been engaged in an executive reshuffling under CEO John Martin.

Wright will not be involved in DreamWorks television unit, Amblin Television, which will continue to be headed by Daryl Frank and Justin Falvey.

A contender to replace Steve Koonin, who left as the head of Turner Entertainment Networks last spring to become CEO and an equity player with the NBA”s Atlanta Hawks, Wright seemed to be under fire when Time Warner chief Jeff Bewkes said during an earnings call with analysts in April that he was not satisfied with TNT’s ratings performance and that it hadn't taken enough creative risks.

Instead, Wright’s departure comes as TNT topped cable’s Nielsens this summer, buoyed by Michael Bay’s The Last Ship and strong performances by mainstays Rizzoli & Isles and Major Crimes. 

Wright’s Turner tenure was highlighted by the development of The Closer, the Kyra Sedgwick procedural that ranked as basic-cable top ratings performer in its day, as well as the acquisition of The Big Bang Theory, a syndicated, stacking gambit that helped push TBS well up the Nielsen charts in primetime.