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This is an audio transcript of the FT News Briefing podcast episode: ‘Netflix’s CEO steps down’

Marc Filippino
Good morning from the Financial Times. Today is Friday, January 20th, and this is your FT News Briefing.

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There’s a big leadership shake-up at a major streaming service. Corporate executives are wrestling with how to adjust supply chains. Plus, many people in China have been posting video memories of 2022, a year of harsh Covid lockdowns.

[AUDIO CLIP IN CHINESE PLAYING]

Yuan Yang
Now, having a collective narrative, which lives on in these social media clips and these online memories, says to others, you know, this was not something that you lived through alone.

Marc Filippino
I’m Marc Filippino, and here’s the news you need to start your day.

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Netflix co-founder Reed Hastings is stepping down as CEO but staying on as executive chair. The company made the announcement as it was reporting its quarterly earnings yesterday. Hastings started the company way back in 1997 when it rented out DVDs by mail. He grew the company into one of the most powerful studios and streaming services in the world. But Netflix hit hard times recently, losing more than a third of its market value over the past year. Netflix said yesterday that it had a pretty great fourth quarter, though. Revenue climbed 2 per cent year on year, and the company added nearly 8mn new subscribers.

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Central bankers are making it clear that they’ll keep battling inflation by raising interest rates. European Central Bank president Christine Lagarde had this to say yesterday at the World Economic Forum in Davos.

Christine Lagarde
And we shall stay the course until such time when we have moved into restrictive territory for long enough so that we can return inflation to 2 per cent in a timely manner.

Marc Filippino
Meanwhile, in Chicago, Federal Reserve vice-chair Lael Brainard also used the phrase “stay the course”. She said the US central bank had more to do to get inflation down. That’s despite signs that price pressures are easing. Brainard also said it’ll take time and resolve to get inflation back down to the Fed’s 2 per cent target.

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Global trade is rebounding since the worst of the pandemic and the war in Ukraine. Ships are no longer backlogged at major ports and costs have come down. But the disruptions over the past few years have left corporate executives pretty bruised.

Andrew Edgecliffe-Johnson
But they’ve also learned some pretty big lessons about how they can operate in a much more uncertain supply chain environment.

Marc Filippino
Andrew Edgecliffe-Johnson has been talking to global executives about lessons they’ve learned.

Andrew Edgecliffe-Johnson
The key one is really you can no longer depend on a single country to be your sole source of supply for any critical components, any critical commodities or other products for what you sell. And so we’ve seen what’s often called the “China plus one” strategy because so much of global production is actually dependent on China. Yet we’re seeing more people move to India, to Vietnam.

Marc Filippino
Edge says as companies look at how to adjust supply chains, they’re figuring out what to prioritise.

Andrew Edgecliffe-Johnson
They’re looking at what are the absolutely critical components that we can’t do without. And first on that list for many companies is semiconductors, which is why we’re seeing so much action and so much money being thrown by governments around the world to try and bolster domestic semiconductor manufacturing.

Marc Filippino
But this “China plus one” strategy and plans to friendshore production, Edge says, it’s going to take some time and hard effort for companies to wean themselves off of China.

Andrew Edgecliffe-Johnson
I think there’s a very delicate dance being played right now, certainly in corporate America. The executives I spend most of my time talking to, the US Chamber of Commerce last week came out with its annual State of American Business speech, and that makes a lot of very hard talk about China on human rights, on intellectual property and other issues, with a message that we still need to keep this market open. This is absolutely critical for large and small businesses in the US alike.

Marc Filippino
Andrew Edgecliffe-Johnson is our US business editor.

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In China recently, a big entertainment website called NetEase asked people for their memories of 2022. Videos poured in showing painful, emotional moments during the country’s harsh Covid lockdowns. The FT’s Yuan Yang wrote about why these collective memories are so important, and she joins us now. Hi, Yuan.

Yuan Yang
Hi, thanks for having me.

Marc Filippino
I want to play a video compilation. It’s got music underneath, but we can hear what people are saying. And I want you to describe what’s going on for us.

[AUDIO CLIP IN CHINESE PLAYING]

Yuan Yang
So this is a gentleman in Shanghai very politely apologising to his neighbours, saying that his wife has been tested positive for Covid and has been taken away for quarantine. I think what this really highlights is how much of a stigma it was to have somebody living with you catch Covid because then could lead to a mass lockdown of the whole community.

[AUDIO CLIP IN CHINESE PLAYING]

This is a really heartbreaking clip. It shows video and audio of a mother, it seems, who is going from door to door in her community, trying to get fever medicine for her child, saying that she has already called the emergency services and not responding.

[AUDIO CLIP IN CHINESE PLAYING]

This is a truck driver. He’s kneeling in the middle of the road as cars drive past him. He’s saying my mother’s terminally ill in hospital, and he’s trying to get home, but he seems to be unable to get home presumably because of all the different barricades and lockdowns that there are that prevent people from moving from city to city.

Marc Filippino
So, Yuan, these scenes are pretty heart-wrenching. And I understand that there’s a lot of these videos going around, but Beijing’s been censoring them. Why would they do that?

Yuan Yang
The government doesn’t want to have any admission that there was mistakes in its policies, even after they’ve abandoned the policies. So even after there’s been a complete U-turn on zero-Covid and Covid restrictions have been completely lifted from China now. There’s no ability to reflect on the last few years and say, what did we do wrong? What did we get right? And bearing in mind they did get a lot of things right, especially at the start of the pandemic, as well as getting a lot of things wrong in the middle and end of it. But none of that is discussed, as you know. Now, China is back to normal, as the vice-premier said a few days ago at Davos, and we’re all moving on.

Marc Filippino
But despite all the censorship, people are still sharing these videos to preserve them. Why do you think it’s important to keep these collective memories?

Yuan Yang
The last three years in China have been profoundly destabilising. And I think it’s really important when individuals, when a society has gone through such tremendous change, to be able to have space to reflect and digest and process those emotional moments, especially the traumas that have come with them, whether that’s the trauma of bereavement or from being, or the trauma of being separated from your young child who’s been taken away to quarantine.

Now, having a collective narrative which lives on in these social media clips and these online memories helps that because it says to others this was not something that you lived through alone. This is a social level disruption. And this is something that we can make sense of at the level of community rather than things that we are suffering individually as victims. I think that’s a really important step towards coming to a recognition of the rights and wrongs of what happened as well. And it would be incorrect to conclude that China’s handling of the pandemic was uniquely terrible, or that it was all bad either. So I think it’s really important to come to a nuanced view of these policies. But it’s impossible to come to any conclusion or any reflection if there isn’t a collective history that remains alive.

Marc Filippino
Yuan Yang is the FT’s Europe-China correspondent. Thanks, Yuan.

Yuan Yang
Thank you.

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Marc Filippino
Before we go, we know that you have opinions about FT podcasts, and we want to hear them. We’re running a survey to find out what listeners think about our shows. It’ll only take about 10 minutes of your time, and you’ll be entered to win a pair of sweet Bose earbuds. Just go to FT.com/briefingsurvey. We’ll have that link in the show notes.

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This has been your daily FT News Briefing. Make sure you check back next week for the latest business news. The FT News Briefing is produced by Sonja Hutson, Fiona Symon and me, Marc Filippino. Our editor is Jess Smith. We had help this week from David da Silva, Michael Lello and Gavin Kallmann. Our executive producer is Topher Forhecz. Cheryl Brumley is the FT’s global head of audio, and our theme song is by Metaphor Music.


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