The Netflix stream platform launched a cost-cutting programme in all areas, from personnel costs to the rental of cloud resources, as reported by The Wall Street Journal with reference to its own sources.
Netflix, which ended in June, reported a reduction in the number of subscribers by a million, with the failure of the service management associated with increased competition, but there was a need to reduce costs; this year, the company reduced more than 400 employees, promising not to touch the content budget; as a result, the reduction in costs affected most aspects of the company's business and the overall financial discipline had to be tightened.
In particular, Netflix has decided to improve its control over the increase in the cost of the Amazon Web Services cloud service provider, its long-standing partner. One of its most important strengths, the flow service has always considered the availability of the service and has never saved on cloud resources, but it may soon be revised: WSJ sources argue that the company's management is considering reducing the amount of technical data and content copies.
Netflix has expanded the recruitment of junior staff, from interns to young professionals who have only graduated, although it has previously given priority to experienced professionals, especially in engineering positions; however, with the new personnel policy, it is possible to spend less on salaries and to transfer highly qualified staff to the complex tasks on which the development of the company depends.
In the past Netflix staff could order unlimited quantities of branded products such as mugs, hoodies and children's jumpsuits, and now only $300 a year.
Real estate costs have been significantly reduced: the company closed its office in Salt Lake City, and its employees were moved to remote locations; facilities in California's Los Gatos and Los Angeles had to be abandoned; lawyers, technical specialists who assisted the Support Service and the content development unit had previously worked in Salt Lake City; the call centre functions had been outsourced a few years ago, and investment in the software, which was being used to create original content, had been reduced this year; in particular, the development of a planner who had helped distribute the presence of actors and technicians during the filming of different scenes had stopped. Finally, the studio staff were advised to pay more attention to ordering software licences, some of the names being too expensive.