after being fired, Reed Hastings promises “significant” investments, but where? –

Netflix is ​​in the midst of a resurgence, expanding its content space and core business model in ways that would have been unthinkable just a few years ago. At the same time, the company is facing new pressures, subscriber growth has stalled and competition is rapidly increasing.

This is a backdrop based on Netflix’s “business adjustment,” Netflix co-CEO Reed Hastings said in a June 23 memo to employees.

The company laid off 300 employees that day, which in turn cut 150 in May. Earlier this year, Netflix also laid off several employees and contractors on its editorial issue Tudum.

But critically, Hastings added in his memo that the cuts would soon give way to growth.

“[A]“We will scale back some areas and continue to invest significant amounts of money into our content and people – we plan to grow our employee base from ~1,500 to ~11,500 over the next 18 months,” Hastings wrote.

In other words, Netflix will have significantly more employees in 2023 than it does today. But more than 10,000 employees are already working in content, marketing and technology (the company says it had 11,300 employees at the end of 2021 before layoffs or layoffs were reduced), where the hires could indicate how the company sees its future. .

One area where Netflix has spoken out about its investments is international expansion. The company is the only genuine global streaming service available in nearly every country in the world (the two big exceptions are mainland China and Russia earlier this year).

In a letter to shareholders in the first quarter of 2022, Ted Sarandos and Hastings expressed their views on the matter:

“Ultimately, much of our growth will come from outside the United States,” the letter read. “Traditionally, US entertainment companies see ‘international’ as an export market for US content. But we saw long ago that wonderful stories can be made anywhere and loved everywhere: a dramatically expanded pool of creators we can work with to increase the diversity of our programming and better cater to local tastes.

“To support this, we are developing opportunities such as creative development, personalization and language presentation/localization,” he said. Netflix now produces movies and TV in over 50 countries with a high degree of integration into the local entertainment ecosystem, creating blockbusters from all regions.

In other words, when it comes to adding subscribers, this is another place in the world where there are real opportunities. If customer growth has matured in North America, relocating employees to other parts of the world makes strategic sense.

But the company’s expansion is not just geographic. It is also in the process of building new areas of its core business.

To that end, Netflix’s attack on video games stays with the newborn.

The company has acquired three small game studios — Boss Fight Studios, based in Texas, Night School Studio, based in California, and Post Games, in Finland — and executives say other M&A capabilities in the space may follow.

So far, it’s only released a few mobile games and suggests games for other platforms (like TV Glass) are coming. According to the company’s job vacancy review, it has several dozen openings on the business gaming side, including working on live services that support multiplayer gaming that may be broader than current offerings (think Fortnite ANY Fall Guys).

As Netflix’s gaming ambitions grow, so does the number of employees in the field.

And, of course, Netflix will significantly expand its business model when it delivers the expected level of advertising later this year.

But while Netflix has a lot of in-game work, none of them are related to advertising… at least not yet.

Instead, Netflix appears to be trying to find an outside partner to help launch the promotional product by bringing it in-house. And such an addition would be no small feat. If you are going to create your own offer, you will need teams of technologists (to build the stack and any software platforms needed to deliver the ad), creatives (develop ad formats that the user will see) and of course, sales teams, this will really prevent big business. , which complement the purchase of any automated ad. Companies like Roku have built these kits over the years, and Netflix likely needs a similar gateway, although a third-party deal could fill that gap.

“What we are going to do first is not a representation of what the product will look like in the end. Start light, keep it simple and iterate quickly,” Sarandos said at the Cannes Lions Marketing Festival on June 23, adding that “what I want our product to be is better than TV. [advertising].”

Netflix is ​​talking to companies like Comcast (which can provide its FreeWheel ad team and NBCUniversal ad sales opportunities), digital video ad giants Roku and Google, and ad tech giant The Trade. help you out. Enter the world of advertising quickly and smoothly.

Whichever company (or companies) you partner with can have an impact on the roles the employee hires internally as they plan to distribute advertisements, but it would be wise to assume that he or she will work in the space in the future. months.