On Wednesday, Netflix announced its subscriber base in the United States declined for the first time since 2011.
The streaming giant had forecast a gain of 300,000 during the second quarter (April through June), but instead it lost about 130,000 homes here. Thanks to international growth, Netflix still added 2.7 million customers overall, pushing its global base to a record 151 million. But even that wasn’t entirely good news: Netflix had told investors it expected to gain about 5 million new customers in the quarter, making this its biggest missed forecast since 2016. So what’s behind this gloomy quarter for the company?
Netflix blames the decline on its most recent price increase. “Our missed forecast was across all regions but slightly more so in regions with price increases,” Netflix explained to its investors, but they also blame lackluster programming. “We think Q2’s content slate drove less growth in paid net adds than we anticipated.”
Perhaps there’s another factor that Netflix is missing, or evening ignoring when it comes to their disappointing numbers. For more than a year now, Netflix has made some controversial moves that undeniably alienated a large portion of its U.S. subscribers: conservatives.
Back in March of 2018, Netflix named former Susan Rice, the former National Security Adviser and Ambassador to the United Nations under Barack Obama, to their Board of Directors. Susan Rice was a key figure in the Benghazi attack cover-up, pushing a false narrative to the media in order to give Obama political cover before the 2012 election. Rice was also behind the controversial unmasking of Trump administration officials on intelligence reports involving the Russian collusion hoax. Rice’s placement on the Board of Directors was also criticized because her national security background seemed irrelevant to being on the BOD of an entertainment company.
Nevertheless, Netflix CEO Reed Hastings defended the decision saying, “For decades, she has tackled difficult, complex global issues with intelligence, integrity and insight and we look forward to benefiting from her experience and wisdom.” Yeah, right.
Then there was the announcement in May 2018 that Netflix would be partnering with Barack and Michelle Obama to produce content. “President Barack Obama and Michelle Obama have entered into a multi-year agreement to potentially produce films and series for Netflix, potentially including scripted series, unscripted series, docuseries, documentaries, and features,” they announced via Twitter.
President Barack Obama and Michelle Obama have entered into a multi-year agreement to produce films and series for Netflix, potentially including scripted series, unscripted series, docu-series, documentaries, and features.
— Netflix US (@netflix) May 21, 2018
The announcement was met with immediate backlash from conservatives, just like the Susan Rice announcement did.
More recently, Netflix threatened to boycott Georgia and cease filming in the state over its controversial abortion law. “We have many women working on productions in Georgia, whose rights, along with millions of others, will be severely restricted by this law,” said Netflix’s chief content officer, Ted Sarandos, in a statement to Variety in May. “It’s why we will work with the ACLU and others to fight it in court. Given the legislation has not yet been implemented, we’ll continue to film there, while also supporting partners and artists who choose not to. Should it ever come into effect, we’d rethink our entire investment in Georgia.” In response to Netflix’s threat to boycott Georgia, pro-lifers, in turn, called for a boycott of Netflix.
Does Netflix really expect us to believe that rate hikes are to blame for their loss of subscribers when previous rate hikes did not have a similar impact? Maybe they should consider the possibility that the repeated alienating of conservatives subscribers and potential subscribers was also a contributing factor.
We’ve seen Hollywood take huge hits because of actors and programming becoming increasingly political and agenda-driven. The anti-Trump Murphy Brown reboot was canceled after just one season, yet Tim Allen’s Last Man Standing, which was canceled by ABC (possibly due to conservative politics on the show), was brought back on Fox and continues to have big ratings. I think it’s time Netflix, and Hollywood in general, acknowledge the fact that conservatives crave entertainment too, and they don’t want to be lectured with left-wing propaganda when they watch a movie or a series. They want high-quality entertainment that speaks to them instead of talking down to them.
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Matt Margolis is the author of the bestselling book The Worst President in History: The Legacy of Barack Obama. His new book, Trumping Obama: How President Trump Saved Us From Barack Obama’s Legacy, will be published on July 30, 2019. You can follow Matt on Twitter @MattMargolis
