Netflix Using Growing Political Clout to Challenge Another Merger

Netflix CEO, a Democratic donor, expands influence in D.C.

May 11, 2015

Under the leadership of major Democratic donor Reed Hastings, Netflix has grown its influence in Washington, D.C., and is wielding that influence to get its way on multiple legal issues that are central to its business model.

Netflix was one of the most vocal opponents to the now-collapsed Comcast-Time Warner merger and is now working to make sure that a potential merger between AT&T and DirecTV includes provisions that protect Netflix.

Netflix is asking the Federal Communications Commission to stipulate that AT&T be barred from charging interconnection fees to ensure that streaming video can run smoothly, but documents show AT&T is refusing to cave to the demand. AT&T also states that Netflix's ability to compete is not threatened, as the two have already signed a longterm contract.

Netflix's stance on the merger is being closely watched due to its successful campaign against the Comcast-Time Warner deal. The ability to influence these decisions is partially due to a dramatic increase in Netflix's lobbying budget since the beginning of the Obama administration, according to a report by the Hill.

The young company’s lobbying in Washington has ballooned since 2009, when it spent its first $20,000. Since 2012, it has spent more than $1 million per year — consistently ranking among the top 10 Internet lobbying companies.

It spent $1.26 million last year, which narrowly made 2014 its biggest year. It is on track to spend a similar amount in 2015.

Also ballooning is the political spending of CEO Reed Hastings. On the federal level, Hastings has contributed to both of Obama's presidential campaigns, and has made large donations to multiple Democratic political groups such as $100,000 to the Senate Majority PAC in 2014 and nearly $90,000 to the Democratic National Committee.

The majority of Hastings' spending, however, has gone to state campaigns. In California, for example, Hastings spent $8.5 million over just 10 years on different political campaigns.

Published under: Democratic Donors