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 a transgender woman’s biological sex determines her gender and can’t be changed.
“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.”
Mr. 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.”