NY Times Includes Reed Hastings in List of "Worst C.E.O.'s of 2011"

Sydney Findelstein, in "Another View" in the NY Times, put together a list of the worst CEO's of 2011 and included Netflix CEO Reed Hastings:

My final entry in the Worst C.E.O.’s of 2011 is Reed Hastings of Netflix. And if ever a chief executive found himself in the midst of what the economist Joseph Schumpeter called creative destruction, it is Mr. Hastings. New businesses destroy old ones, and in this way innovation and capitalism progress. Certainly that’s the story of the demise of Blockbuster at the hands of Netflix.

In 2011, Mr. Hastings took on the challenge directly by splitting Netflix into two parts, the original DVD mail-order business and the emerging online streaming business. Rather than ignore change, like the co-chiefs at RIM, Mr. Hastings wanted to increase the viability of the newer streaming business by removing it from the traditional business that it was meant to usurp. Unfortunately, he also decided to aggressively increase prices, complicate the customer experience and then partially backtrack on the whole thing when an onslaught of bad press ensued. In an instant, Netflix went from beloved icon of innovation to just another big, bad company ripping off customers, and the company’s stock is down almost 70 percent.

 

Comments

[momo]

Do they mention whether Netflix or the NYT lost more subscribers in 2011?

[Michael]

Did they list the NYT CEO who just quit last week? After driving the stock price down 80% in her 7 years as CEO, selling off assets, and taking on millions in debt, she gets a $4.5 million dollar golden parachute and Reed Hastings is taking a pay cut.

http://online.wsj.com/article/SB10001424052970203893404577100891609545750.html

And Hastings is the worst CEO??

[Edward R Murrow]

For the last few years, Netflix has had almost zero competition. How is it possible that Hastings messed that up?

With the competition that RIM faces, you can almost understand that they always need to be trying new things and some of the things aren't going to work out.

But Netflix had an open floor and just needed to continue to run to the basket and make easy layups and Hastings couldn't do it.

[Janes'_kid]

If the stock is down 70% then it was probably overpriced. The stock may be healthier now.

The gripes about customer service in nearby threads are probably much more germane.

[moviegeek]

"The gripes about customer service in nearby threads are probably much more germane."

The God damn Germans got nothin' to do with it. :)

Seriously, Reed Hastings did some stupid things this year but the ex-NYT CEO is the worst.

[El]

I am not surprised Hastings made the list honestly. Bad decisions are made when companies lack competition.

Netflix needed Blockbuster. Blockbuster went out the way it did because it lacked competition and started monopolizing the rental industry. Because Netflix doesn't really have any competition (Hulu is a joke due to the commercials, and Blockbuster is hardly a threat anymore) they are able to monopolize the system.

Price increases happen because they can get away with it.

But one good thing has come from the missteps of Hastings, it has increased interest in improving Amazon Instant Video and other services like it to hopefully become better foes against Netflix.

Competition is healthy and needed to keep companies like Blockbuster and Netflix from abusing the system.

Hopefully, Hastings won't make the same mistakes next year and underestimate his fan base.

[Rob O.]

Sweet justice! Hastings' greed and total lack of consideration for his loyal customers is his undoing. Netflix needs to oust him entirely and then set about aggressively mending its broken rapport with the customers.

[Randy Harmelink]

To tell the truth, I think Hastings' decisions were just the straw that broke the camel's back. It's stock price was an unrealistic one -- a bubble just waiting to be popped. IMO, NetFlix has an unsustainable business model in streaming.

For example, a new release on Amazon would cost you $3.99 or so to stream, with about $3 of that cost going to the content provider. How can NetFlix possibly compensate content providers for premium content when they are only charging their customers $7.99 a month?

[Shawn Purcell]

Personally, I think the reaction to Reed Hastings' mistakes is a bit much. Yes, he screwed up, but it wasn't out of greed. He was trying to pay the huge bill for content that the studios impose. When he was the media darling, that was overblown, and now his 'villain' status is overblown too. His great strength is to innovate, and to think for himself in ways that often go against conventional wisdom. Sometimes that backfires. Reed, I hope you will stay true to yourself and try not to let this whole thing make you not take risks to continue to innovate and lead. We need guys like you.

I saw this scene last night in "Invictus":

Brenda Mazibuko: You're risking your political capital, you're risking your future as our leader.
Nelson Mandela: The day I am afraid to do that is the day I am no longer fit to lead.

(imdb.to/uSxYdu)

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