Entertainment Giant Reeling From Sudden Fallout

I quit!

Netflix faces a storm of cancellations as Reed Hastings’ political endorsement backfires, leaving the streaming giant in hot water.

At a Glance

  • Netflix co-founder Reed Hastings endorsed Kamala Harris and donated $7 million to her campaign
  • Cancellations surged, with the churn rate nearly tripling in the US following the endorsement
  • July 26 marked Netflix’s worst day for cancellations in 2023
  • The hashtag #CancelNetflix trended as frustrated subscribers posted about their cancellations
  • The long-term impact on Netflix’s business remains unclear

Netflix’s Liberal Leanings Spark Conservative Backlash

In a move that has ignited fury among conservative viewers, Netflix Chairman Reed Hastings publicly endorsed Vice President Kamala Harris for president, triggering a wave of account cancellations. The streaming giant’s co-founder not only voiced his support but also put his money where his mouth is, contributing a staggering $7 million to a super PAC backing Harris. This overt political stance has not sat well with a significant portion of Netflix’s user base, particularly supporters of former President Donald Trump.

The backlash was swift and severe. Netflix’s churn rate in the United States nearly tripled following Hastings’ endorsement, with the cancellation rate hitting a whopping 2.8% in July – the highest since February. The five days following the endorsement saw an unusually high peak in cancellations, culminating on July 26, which marked Netflix’s worst day for cancellations in 2023.

Conservative Viewers Feel Betrayed

The outcry from conservative subscribers was palpable. Many took to social media to express their disappointment and anger, with the hashtag #CancelNetflix trending as frustrated users posted about their cancellations. Trump supporters, in particular, called for a boycott of the streaming service, falsely claiming that the company itself had donated to Harris’ campaign.

“Congrats to Kamala Harris — now it is time to win.” Hastings declared, adding fuel to the fire.

This incident is reminiscent of other social media-led boycotts against companies perceived as pushing liberal agendas or diversity initiatives. Conservative activist Robby Starbuck has been at the forefront of such boycotts, targeting companies with DEI (Diversity, Equity, and Inclusion) practices. Netflix, like many corporations, implemented diversity initiatives following the 2020 Black Lives Matter movement, pledging to move 2% of its cash into black-owned banks.

Political Endorsements: A Risky Business

The Netflix debacle serves as a stark reminder of the perilous consequences corporations can face when their leaders engage in political endorsements. By aligning with a specific political figure or party, companies risk alienating a significant portion of their customer base. In today’s polarized political climate, such moves can have immediate and tangible impacts on a company’s bottom line.

While the long-term impact of these cancellations on Netflix’s business remains unclear, the incident has undoubtedly tarnished the company’s reputation among conservative viewers. As of June 30, 2024, Netflix boasted 277.65 million global paid subscribers, generating nearly $10 billion in revenue each quarter. However, this political misstep could potentially put a dent in these impressive figures.

As the dust settles on this controversy, it’s clear that the intersection of corporate America and politics remains a treacherous landscape. Companies would do well to remember that in the world of entertainment, alienating half of your potential audience is a risky gambit indeed.