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    How Netflix’s Corporate Culture Has Changed

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    The company’s latest internal memo about its corporate culture is more about how it expects employees to behave than what it wants to become.Netflix has long been a company known for its secrets: no Nielsen ratings, little feedback on why shows are canceled, no box office numbers for the rare movies that are actually released in theaters.Yet for a place defined by its opaque approach to the outside world, the streaming giant has long been aggressively transparent internally. The company’s philosophy was immortalized in 2009 when Reed Hastings, the company’s co-founder and chief executive, first laid out the corporate ethos in a 125-slide presentation that introduced new buzzy phrases like “stunning colleagues,” “the keeper test” and “honesty always.”The presentation, with its insistence on constant and unfiltered candor, felt both brutal and refreshingly antithetical to Hollywood’s normal way of doing business. To the frustration of former employees and current competitors, it may just be the blueprint that has enabled Netflix to have so much success while its rivals have stumbled.Three more culture memos have followed over the years. Before being released, they are pored over and analyzed for months by top executives. At the same time, any employee can pop into the Google Doc where the memo is being assembled to leave a thought or a comment.The latest iteration of the document, which was released internally on May 8 and will soon be made public, underwent eight months of vetting and received 1,500 comments from employees, according to Sergio Ezama, Netflix’s chief talent officer. It is five pages long (half the length of Mr. Hastings’s final memo in 2022), and some core tenets have changed, however slightly.When Mr. Hastings titled his 2009 presentation “Netflix Culture,” he gave it the subhead “Freedom and Responsibility.” The idea was that Netflix trusted its employees to act in the best interest of the company. If you want a vacation, take a vacation. If you have a baby and need to go on leave, go on leave. Documents were shared widely throughout the company without any fear of leaks.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Netflix Adds 2.4 Million Subscribers, Reversing a Decline

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      Netflix, which has about 223 million subscribers worldwide, will soon introduce a lower-priced service with ads in a bid to attract more customers.Netflix said Tuesday that it added more than 2.4 million subscribers in the third quarter — mainly from outside the United States — snapping a streak of customer losses this year that spurred unease among investors and questions about how much more the streaming business could grow.The streaming giant said it now has 223 million subscribers worldwide, after beating its earlier forecast of about one million additions for the quarter. Netflix lost 200,000 subscribers in the first quarter, and nearly one million in the second.“After a challenging first half, we believe we’re on a path to re-accelerate growth,” Netflix said in its quarterly letter to shareholders. “The key is pleasing members.”Netflix is preparing to introduce advertising on its service on Nov. 3, part of a bid to attract more customers with a lower-cost subscription. The advertising-supported tier, priced at $6.99 a month in the United States, will show subscribers four to five minutes of ads per hour of content they watch.Netflix generated about $7.9 billion in revenue in the third quarter, a nearly 6 percent increase from the same period last year. The company generated about $1.4 billion in profit, a 3 percent decrease from a year earlier.The Race to Rule Streaming TVNetflix Ads: The streaming company said it will soon offer a cheaper ad-supported subscription, which will show people four to five minutes of ads per hour of content they watch.Late-Night Talk Shows: TV executives are mulling the future of the genre, which is struggling to make the leap to the streaming world.Apple’s Will Smith Movie: After a long discussion, Apple said it will release the film “Emancipation” — the actor’s first since his infamous slap at the Oscars — in December.Cable Cowboy: The media mogul John Malone opened up about the streaming wars, the fast-changing news business and his own future.Netflix shares were up more than 10 percent in after-hours trading.Netflix said in its letter to shareholders that it expected to add 4.5 million subscribers in the fourth quarter, a 46 percent decrease from the 8.3 million subscribers it added during the same period last year. Netflix also said it would stop providing guidance to investors on its projected subscriber count beginning next quarter.Rich Greenfield, an analyst for Lightshed Partners, said the results indicated that Netflix would flourish as competitors continue to lag behind.“I think the reports of streaming’s death or maturity have been greatly exaggerated,” Mr. Greenfield said.The decision to introduce an advertising option on Netflix was an about-face for the company, which for years had highlighted its ad-free experience as a selling point for customers. But this year, after announcing subscriber losses on the company’s first-quarter earnings call, the co-chief executive Reed Hastings reversed course, saying that an advertising-supported plan would allow customers to choose their experience.Streaming has become an increasingly competitive industry in recent years. Disney, for instance, reported in August that it had about 221 million subscriptions across its bundle of services. It will start offering a lower-priced advertising tier for Disney+ in December.Mr. Hastings expressed relief about the company’s financial results during a video interview conducted by an analyst that was posted by Netflix on Tuesday evening.“Well, thank God we’re done with shrinking quarters,” Mr. Hastings said, laughing.Netflix is breaking with convention in other ways this fall. The company plans to release “Glass Onion: A Knives Out Mystery” in 600 theaters across the United States for one week beginning on Nov. 23 ahead of its streaming debut, the first time the company has struck a deal with the nation’s largest theater chains at once. The movie, written and directed by Rian Johnson, is the anticipated follow-up to the 2019 hit starring Daniel Craig as the Delphic detective Benoit Blanc.Netflix told employees this year that it was also planning to crack down on password sharing, which allows users to watch content without paying for a subscription. The research firm MoffettNathanson estimates that 16 percent of Netflix users share passwords, more than any other major U.S. streaming service. Netflix said in April that passwords were being shared with an additional 100 million households, according to its estimate.The company has also cracked down on costs. In May, Netflix laid off about 150 workers across the company, primarily in the United States, or about 2 percent of its total work force. Netflix said in a statement that the cuts had been spurred by the company’s slower revenue growth.Despite the changes, Netflix hasn’t yet been able to reverse a precipitous decline in its share price. The company’s stock has tumbled more than 60 percent over the last year amid a broader market slump, as investors and analysts grapple with the economics of streaming video.During the third quarter, Netflix released a mix of films and TV shows, including “The Gray Man,” a big-budget action film starring Ryan Gosling and Chris Evans and directed by Joe and Anthony Russo, the sibling filmmakers behind “Avengers: Infinity War.” Other popular titles included the serial killer show “Monster: The Jeffrey Dahmer Story”; the romantic drama “Purple Hearts”; and “Stranger Things,” which released the second half of Season 4 near the end of last quarter. More

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      Netflix Tells Employees Ads May Come by the End of 2022

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      Netflix could introduce its lower-priced ad-supported tier by the end of the year, a more accelerated timeline than originally indicated, the company told employees in a recent note.In the note, Netflix executives said they were aiming to introduce the ad tier in the final three months of the year, said two people who shared details of the communication on the condition of anonymity to describe internal company discussions. The note also said Netflix planned to begin cracking down on password sharing among its subscriber base around the same time, the people said.Last month, Netflix stunned the media industry and Madison Avenue when it revealed that it would begin offering a lower-priced subscription featuring ads, after years of publicly stating that commercials would never be seen on the streaming platform.But Netflix is facing significant business challenges. In announcing first-quarter earnings last month, Netflix said it lost 200,000 subscribers in the first three months of the year — the first time that has happened in a decade — and expected to lose two million more in the months to come. Since the subscriber announcement, Netflix’s share price has dropped sharply, wiping away roughly $70 billion in the company’s market capitalization.Reed Hastings, Netflix’s co-chief executive, told investors that the company would examine the possibility of introducing an advertising-supported platform and that it would try to “figure it out over the next year or two.”The Race to Rule Streaming TVA New Era: Companies like Netflix, HBO, Hulu and Amazon ushered out the age of “prestige TV” and ushered in an age of anything goes.Netflix’s Woes: The streaming star lost subscribers for the first time in a decade as competitors continue to expand. What explains its poor performance?A Warning Sign?: Netflix’s sudden problems may be an indication that other streaming services are heading toward an unstable future.Commercials: Streaming executives are having a change of heart about ads and offering lower-priced versions in exchange for commercials.The recent note to staff signaled that the timeline has sped up.“Yes, it’s fast and ambitious and it will require some trade-offs,” the note said.A Netflix spokeswoman declined to comment.Netflix offers a variety of payment tiers for streaming access; its most popular plan costs $15.49 a month. The new ad-supported tier will cost less. Other streaming services have similar plans. HBO Max, for instance, offers a commercial-free service for $15 a month, and charges $10 a month for the service with advertising.Indeed, in the note to employees, Netflix executives invoked their competitors, saying HBO and Hulu have been able to “maintain strong brands while offering an ad-supported service.”“Every major streaming company excluding Apple has or has announced an ad-supported service,” the note said. “For good reason, people want lower-priced options.”Netflix has discussed its interest in building out an advertising infrastructure externally as well, including with a company called The Trade Desk, which helps advertisers place ads on various internet-enabled platforms, said a person familiar with the discussions who spoke on condition of anonymity in order to describe them. The Trade Desk counts David Wells, the former chief financial officer of Netflix, as a board member, and has been in touch with Netflix for years, this person said, but discussions ramped up recently, after Netflix said publicly that it would create an advertising tier.Last month, Netflix also announced that it intended to begin charging higher prices to subscribers who shared their account with several people.“So if you’ve got a sister, let’s say, that’s living in a different city — you want to share Netflix with her, that’s great,” Greg Peters, Netflix’s chief operating officer, said on the company’s earnings call. “We’re not trying to shut down that sharing, but we’re going to ask you to pay a bit more to be able to share with her.”Mr. Peters said the company would go “through a year or so of iterating” on password sharing before it rolled out a plan.In the note to employees, Netflix executives said the advertising-supported tier would be introduced “in tandem with our broader plans to charge for sharing.”Tiffany Hsu More

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      Gadsby and Netflix Employees Pressure Executive Over Dave Chappelle Special

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      Tensions at Netflix continued to flare on Friday, 10 days after the release of a special by the comedian Dave Chappelle that critics inside and outside the company have described as promoting bigotry against transgender people.Early on Friday, a Netflix star criticized the company and Ted Sarandos, a co-chief executive, in a stinging social media post. Later in the day, Netflix said it had fired an employee for sharing documents related to Mr. Chappelle with a reporter, and Mr. Sarandos fielded pointed questions from employees during a companywide virtual meeting.In a rare public rebuke, the Australian comedian Hannah Gadsby upbraided Mr. Sarandos by name for his defense of Mr. Chappelle. Ms. Gadsby, whose 2017 Netflix special, “Nanette,” earned an Emmy and a Peabody Award, is the most prominent entertainer to criticize Mr. Sarandos and Netflix, which she referred to in an Instagram post as an “amoral algorithm cult.”Mr. Sarandos and Netflix’s other co-chief, Reed Hastings, have been unwavering in their support of Mr. Chappelle, who signed a lucrative multiyear deal with the company in 2016 and has won Emmys and Grammys for his Netflix work. In a note this week, Mr. Sarandos countered the arguments of Netflix staff members who had suggested that Mr. Chappelle’s special, “The Closer,” could lead to violence against transgender people, writing that he had the “strong belief that content on-screen doesn’t directly translate to real-world harm.”Mr. Sarandos, who joined Netflix two decades ago and became its co-chief executive last year, also said that the company would go to great lengths to “ensure marginalized communities aren’t defined by a single story.” He cited inclusive Netflix programs like “Sex Education” and “Orange Is the New Black” as well as Ms. Gadsby’s specials, which also include “Douglas,” released in 2020.In her social media post on Friday, Ms. Gadsby, who is a lesbian, objected to the executive’s references to her in his defense of the company and Mr. Chappelle’s special.Hannah Gadsby, whose Netflix specials were critical and popular successes, called the company “amoral” in a social media post on Friday.Sara Krulwich/The New York Times“Hey Ted Sarandos!” Ms. Gadsby wrote. “Just a quick note to let you know that I would prefer if you didn’t drag my name into your mess. Now I have to deal with even more of the hate and anger that Dave Chappelle’s fans like to unleash on me every time Dave gets 20 million dollars to process his emotionally stunted partial world view.”She continued: “You didn’t pay me nearly enough to deal with the real world consequences of the hate speech dog whistling you refuse to acknowledge, Ted.”Netflix declined to comment on Ms. Gadsby’s remarks.At a virtual company meeting that started at 10 a.m. Pacific time on Friday, Mr. Sarandos replied to a series of tough questions from employees, who asked about Mr. Chappelle’s special and how the company had responded to criticisms of it, according to three people with knowledge of the gathering. The event became emotional when several employees were persistent in their questioning of Mr. Sarandos and his support for someone who they feel engages in hate speech, the people said.After the meeting, Netflix said in a statement that an employee had been fired for sharing internal documents pertaining to Mr. Chappelle with the press.“We have let go of an employee for sharing confidential, commercially sensitive information outside the company,” the statement said. “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 documents included private financial information regarding Mr. Chappelle’s Netflix specials that were published this week by Bloomberg, according to a person with knowledge of the termination. The documents included the costs for the specials — $24.1 million for “The Closer” and $23.6 million for Mr. Chappelle’s previous special, “Sticks & Stones” — as well as an internal metric that determines the value of the specials relative to their budgets.Such data is available to Netflix staff but rarely made public. The appearance of the statistics in a published article is a further sign of how deep the schism is between some Netflix employees and company leadership.Several organizations, including GLAAD, which monitors the news media and entertainment companies for bias against the L.G.B.T.Q. community, have criticized Mr. Chappelle’s special as transphobic. A group of Netflix workers has planned a walkout for next week in protest.Nicole Sperling More

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      Chappelle Special on Netflix Draws Criticism and Internal Unrest

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      The comedian Dave Chappelle’s comments on transgender people and gender in “The Closer” have led to outside criticism and internal unrest at the company that upended Hollywood.It was looking like a great year for Netflix. It surpassed 200 million subscribers, won 44 Emmys and gave the world “Squid Game,” a South Korean series that became a sensation.That’s all changed. Internally, the tech company that revolutionized Hollywood is now in an uproar as employees challenge the executives responsible for its success and accuse the streaming service of facilitating the spread of hate speech and perhaps inciting violence.At the center of the unrest is “The Closer,” the much-anticipated special from the Emmy-winning comedian Dave Chappelle, which debuted on Oct. 5 and was the fourth-most-watched program on Netflix in the United States on Thursday. In the show, Mr. Chappelle comments mockingly on transgender people and aligns himself with the author J.K. Rowling as “Team TERF,” an acronym for trans-exclusionary radical feminist, a term used for a group of people who argue that one’s gender identity is fixed at birth.“The Closer” has thrust Netflix into difficult cultural debates, generating the kind of critical news coverage that usually attends Facebook and Google.Several organizations, including GLAAD, the organization that monitors the news media and entertainment companies for bias against the L.G.B.T.Q. community, have criticized the special as transphobic. Some on Netflix’s staff have argued that it could incite harm against trans people. This week, the company briefly suspended three employees who attended a virtual meeting of executives without permission, and a contingent of workers has planned a walkout for next week.A discussion this week on an internal Netflix message board between Reed Hastings, a co-chief executive, and company employees suggested that the two sides remained far apart on the issue of Mr. Chappelle’s special. A transcript of the wide-ranging online chat, in which Mr. Hastings expressed his views on free speech and argued firmly against the comedian’s detractors, was obtained by The New York Times.One employee questioned whether Netflix was “making the wrong historical choice around hate speech.” In reply, Mr. Hastings wrote: “To your macro question on being on the right side of history, we will always continue to reflect on the tensions between freedom and safety. I do believe that our commitment to artistic expression and pleasing our members is the right long term choice for Netflix, and that we are on the right side, but only time will tell.”He also said Mr. Chappelle was very popular with Netflix subscribers, citing the “stickiness” of “The Closer” and noting how well it had scored on the entertainment ratings website Rotten Tomatoes. “The core strategy,” Mr. Hastings wrote, “is to please our members.”Replying to an employee who argued that Mr. Chappelle’s words were harmful, Mr. Hastings wrote: “In stand-up comedy, comedians say lots of outrageous things for effect. Some people like the art form, or at least particular comedians, and others do not.”When another employee expressed an opinion that Mr. Chappelle had a history of homophobia and bigotry, Mr. Hastings said he disagreed, and would welcome the comedian back to Netflix.“We disagree with your characterization and we’ll continue to work with Dave Chappelle in the future,” he said. “We see him as a unique voice, but can understand if you or others never want to watch his show.”He added, “We do not see Dave Chappelle as harmful, or in need of any offset, which we obviously and respectfully disagree on.”In a note to employees this week, Ted Sarandos, Netflix’s other co-chief executive, expressed his unwavering support for Mr. Chappelle and struck back at the argument that the comic’s statements could lead to violence.“While some employees disagree,” Mr. Sarandos said in the note, “we have a strong belief that content onscreen doesn’t directly translate to 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,” he continued. “Adults can watch violence, assault and abuse — or enjoy shocking stand-up comedy — without it causing them to harm others.”“The Closer” was Mr. Chappelle’s sixth special for Netflix. Reed Hastings, one of the co-chief executives, said Netflix would “continue to work with Dave Chappelle in the future.”Robyn Beck/Agence France-PresseMr. Chappelle, who signed a multiyear deal with Netflix in 2016, warns his audience early in “The Closer” that he will be delving into hot-button topics. Before going into transgender issues, he offers a routine about threatening to murder a woman who criticized his work as misogynist and describes an encounter when he supposedly beat a lesbian at a nightclub.Terra Field, a software engineer at Netflix and one of the three employees who were suspended for joining a quarterly meeting of top executives that they were not invited to, said on Twitter last week that the special “attacks the trans community, and the very validity of transness.” (Ms. Field and the other suspended employees have been reinstated.)Jaclyn Moore, an executive producer for the Netflix series “Dear White People,” said last week that she would not work with Netflix “as long as they continue to put out and profit from blatantly and dangerously transphobic content.”On Wednesday, GLAAD criticized Mr. Sarandos’s claim that on-screen content does not lead to real-world violence. “Film and TV have also been filled with stereotypes and misinformation about us for decades, leading to real-world harm, especially for trans people and L.G.B.T.Q. people of color,” the organization said in a statement.Netflix declined to comment. A representative for Mr. Chappelle did not respond to a request for comment.During the homebound months of the pandemic, Netflix has been viewed as a happy escape, but this is not the first time the company has been mired in controversy. In 2019, it received tough criticism when it blocked access to an episode of Hasan Minhaj’s talk series in Saudi Arabia after the kingdom’s government asked it to do so. Last year, Netflix was accused of sexualizing the child actresses in “Cuties,” a French film. And the company was accused of glorifying sex trafficking after it started streaming “365 Days,” a film from Poland that proved so popular, Netflix ordered two sequels, despite the criticism.As Netflix becomes even bigger, it may find itself in the middle of cultural debates more frequently, said Stephen Galloway, the dean of Chapman University’s Dodge College of Film and Media Arts.“Netflix has gone from the underdog and outsider poking the establishment to the epicenter of the Hollywood establishment,” he said. “When you’re at the center, everything is magnified 100 times. This is going to happen more and more as society itself wrestles with these issues. With Netflix, what will make it further complicated is that it’s a global company with massive international ambitions.”Mr. Chappelle, 48, has had a long and celebrated career, winning an Emmy for his 2018 Netflix special, “Equanimity,” and Grammys for albums taken from the Netflix specials “The Age of Spin,” “Deep in the Heart of Texas” and “Sticks & Stones.” In 2019, he won the Mark Twain Prize for American Humor. Last year, he earned raves from critics for “8:46,” a heartfelt show on the death of George Floyd and the fraught state of race relations in America.He made his reputation largely through “Chappelle’s Show,” a Comedy Central sketch series, and created a legend for himself when he walked away from it after having misgivings about his own success. In particular, he told Time magazine in 2005, he was concerned when he heard a white man laughing at a sketch that satirized racial stereotypes and wondered if his material was being misinterpreted. “When he laughed, it made me uncomfortable,” he said.The critical reaction to “The Closer” has been mixed, with most reviewers acknowledging Mr. Chappelle’s comedic skills while questioning whether his desire to push back against his detractors has led him to adopt rhetorical tactics favored by internet trolls. Roxane Gay, in a Times opinion column, noted “five or six lucid moments of brilliance” in a special that includes “a joyless tirade of incoherent and seething rage, misogyny, homophobia and transphobia.”Last week, as the controversy over the special mounted, Mr. Chappelle made an appearance at the Hollywood Bowl in Los Angeles. In response to a standing ovation, he told the crowd, “If this is what being canceled is like, I love it.” More

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      Netflix Employee Who Criticized Dave Chapelle Is Among 3 Suspended

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      Netflix recently suspended three employees, including a transgender employee who posted a Twitter thread last week criticizing a new Dave Chappelle stand-up special on the streaming service as being transphobic.The employees were suspended after they attended a virtual business meeting among top executives at the company that they had not been invited to, a person familiar with the decision said on Monday, speaking on the condition of anonymity to discuss a personnel matter. Netflix said in a statement that the transgender employee, Terra Field, was not suspended because of the tweets critical of Mr. Chappelle’s show.“It is absolutely untrue to say that we have suspended any employees for tweeting about this show,” a Netflix spokesperson said in a statement. “Our employees are encouraged to disagree openly, and we support their right to do so.”Mr. Chappelle’s comedy special, “The Closer,” debuted on Netflix on Tuesday, and was quickly criticized by several organizations, including GLAAD, for “ridiculing trans people.” Jaclyn Moore, an executive producer for the Netflix series “Dear White People,” said last week that she would not work with Netflix “as long as they continue to put out and profit from blatantly and dangerously transphobic content.”Ms. Field, who is a software engineer at Netflix, tweeted last week that the special “attacks the trans community, and the very validity of transness.”On Monday, after news of her suspension went public following a report by The Verge, she tweeted: “I just want to say I appreciate everyone’s support. You’re all the best, especially when things are difficult.”As criticism of Mr. Chappelle’s special began last week, Netflix’s co-chief executive Ted Sarandos sent a memo to employees defending the comedian.“Several of you have also asked where we draw the line on hate,” Mr. Sarandos wrote in the memo. “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. 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 meanspirited, but our members enjoy it, and it’s an important part of our content offering.”Mr. Sarandos also cited Netflix’s “longstanding deal” with Mr. Chappelle and said the comedian’s 2019 special, “Sticks & Stones,” was also “controversial” and was “our most watched, stickiest and most award-winning stand-up special to date.”In 2019, Netflix was criticized when it blocked an episode of Hasan Minhaj’s topical show, “Patriot Act With Hasan Minhaj,” in Saudi Arabia after the kingdom’s government made a request for it to do so. In the episode, Mr. Minaj criticized the Saudi Arabian government and questioned the role of Crown Prince Mohammed bin Salman in the murder of the journalist Jamal Khashoggi.“We’re not in the news business,” Netflix’s co-chief executive Reed Hastings said in 2019, explaining the decision. “We’re not trying to do ‘truth to power.’ We’re trying to entertain.” More

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      How Disney is Chipping Away at Netflix's Dominance

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      The cracks are showing in Netflix’s worldwide dominance.Netflix is still king of streaming video, but audiences are slowly shifting toward new rivals, namely the Walt Disney Company’s Disney+, according to research from Parrot Analytics.Netflix’s share of worldwide demand interest — a measure, created by Parrot, of the popularity of shows and a key barometer of how many new subscribers a streaming service is likely to attract — fell below 50 percent for the first time in the second quarter of the year.The company’s “lack of new hit original programming and the increased competition from other streamers is going to ultimately have a negative impact on subscriber growth and retention,” Parrot said in a news release before Netflix announced its quarterly earnings on Tuesday.Netflix said it had attracted 1.5 million new subscribers in the second quarter of the year, beating the low bar it had set when it told Wall Street that it anticipated adding just one million.The company said it expected to add about 3.5 million new subscribers in the third quarter, lower than the approximately 5.5 million that investors were expecting. Netflix shares fell as much as 4 percent in after-hours trading on Tuesday before bouncing back a little.The company now has 209 million subscribers, but it lost 430,000 in the United States and Canada, its most lucrative region, over the period. It now has 73.9 million subscribers in that market, with about 66 million in the United States.In a letter to shareholders, Netflix said that “Covid-related production delays in 2020 have led to a lighter first-half-of-2021 slate.” Netflix relies on creating as many different shows and films for as many different audiences as possible, and the pandemic upset that formula, forcing the shutdown of productions around the world.Traditional media players have started to consolidate, again, potentially setting off another race for talent, studio space and production resources. In May, Discovery announced that it would buy WarnerMedia from AT&T, creating the second-largest media giant, behind Disney and ahead of Netflix. Less than two weeks later, Amazon announced that it would buy Metro-Goldwyn-Mayer, home to the James Bond franchise, for $8.45 billion, a price many analysts considered rich.In the earnings call after the report, Reed Hastings, Netflix’s co-chief executive, said he didn’t think it made sense for Netflix to jump into the consolidation game. He even offered his own analysis of some of the industry’s biggest deals, including Disney’s acquisition of the bulk of Rupert Murdoch’s 21st Century Fox.“Certainly Disney buying Fox helps Disney become more of a general entertainment service rather than just a kids and family,” he said. “Time Warner-Discovery — if that goes through — that helps some, but it’s not as significant, I would say, as Disney-Fox.”Mr. Hastings’s co-chief executive, Ted Sarandos, offered a sharper critique of these megadeals. “When are they one and one equals three? Or one and one equals four?” he asked. “Versus what most of them tend to be, which is one and one equals two.”Netflix has downplayed competition concerns even as newer entrants have chipped away at its long-held grip. Disney+ more than doubled its share of demand interest in the second quarter compared with a year earlier, and Amazon Prime Video, AppleTV+ and HBO Max are also gaining, according to Parrot.In its letter to shareholders, Netflix said the industry overall was “still very much in the early days” of the transition from traditional pay television to streaming.“We are confident that we have a long runway for growth,” it said. “As we improve our service, our goal is to continue to increase our share of screen time in the U.S. and around the world.”Mr. Hastings said competition would further stoke streaming across all companies.“As you get new competition in, you get validation — more reasons to get a smart TV or unlimited broadband,” he said. “So for at least the next several years, the growth story of streaming as a whole is very intact.”But Netflix hasn’t seen any impact from the “secular competition,” Mr. Hastings said, referring to Disney or HBO. “So that gives us comfort,” he added.Netflix, he said, is really competing against traditional television, and the “shakeout” won’t happen until streaming makes up the majority of viewing. He cited the latest study from Nielsen, which showed that streaming accounts for about 26 percent of television viewing in the United States, with Netflix making up about 6 percent. Disney+ is far behind at 1 percent.In other words: If Disney+ is hurting us, we haven’t seen it.The argument that Netflix has been competing with regular television and other streamers for a long time overlooks the fact that new rivals like Disney+ and AppleTV+ are much cheaper than Netflix (and subscription television). And although those services produce far fewer originals than Netflix, they appear to be getting more bang for their buck.In the second quarter, Disney+ got a big boost of demand interest from “The Falcon and the Winter Soldier,” a series based on the Marvel Cinematic Universe, which has thoroughly dominated the box office in recent years. “Loki,” another Marvel spinoff, also helped, according to Parrot.Amazon Prime Video got a boost in the period with “Invincible,” an animated superhero series for adults. And AppleTV+ attracted new customers with three originals: “Mosquito Coast,” a drama based on the 1981 novel; “For All Mankind,” a sci-fi series; and “Mythic Quest,” a comedy series that takes place in a game developer studio.Speaking of, Netflix said this month that it planned to jump into video games. It has hired a gaming executive, Mike Verdu, formerly of Electronic Arts and Facebook, to oversee its development of new games. It’s a potentially significant move for the company, which hasn’t strayed far from its formula of television series and films.The company called gaming a “new content category” that will be a “multiyear effort” and said it would be included as part of a subscribers’ existing plans at no extra cost. Games will first appear on its mobile app, an environment that already allows for interactivity. The vast majority of Netflix’s customers watch on big-screen televisions.Gaming isn’t meant to be a stand-alone or a separate element within Netflix. “Think of it as making the core service better,” Mr. Hastings said. “Really, we’re a one-product company with a bunch of supporting elements.” More