TO: FROM:

Interested Parties David Metz and Shakari Byerly Fairbank, Maslin, Maullin, Metz & Associates Key Findings from a Recent Survey of Los Gatos Voters October 12, 2011

RE: DATE:

Fairbank, Maslin, Maullin, Metz & Associates (FM3) recently conducted a survey of 402 voters in the Town of Los Gatos.1 The survey shows overwhelming support for the project to build new office space to provide a headquarters for Netflix. The public is highly informed about the project, with two-thirds of local voters saying they have heard something about the project. Those aware of the project back it by a nearly five-to-one margin; without any additional information, 74 percent are in favor. And after hearing a brief description of the project, support among all Town residents rises to 84 percent. That level of support is extremely durable even after a series of pro and con arguments, 79 percent continue to back it. The survey reveals a broad, deep, and strongly-held community consensus in Los Gatos in support of the new Netflix headquarters. Key specific findings of the survey include the following: Los Gatos voters are well-aware of the proposed project. Survey respondents were asked whether they had seen, heard or read anything about the proposal to build new office space to accommodate a new headquarters for Netflix. As detailed in Figure 1 on the following page, two-thirds of Los Gatos voters have heard something about the project, with 30 percent saying that they have heard a great deal about it.

Methodology: From October 2-5, 2011, FM3 completed 402 telephone interviews with registered Town of Los Gatos voters. The full sample has a margin of sampling error of +/- 4.9%; margins of sampling error for subgroups within the sample will be larger. Some percentages may not sum to 100% due to rounding.

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Town of Los Gatos Voter Survey October 2011 Page 2

FIGURE 1: Awareness of the New Netflix Headquarters

While a majority of voters have heard about the project, there does not seem to be any sense of controversy attached to it. As previously described, 67 percent of voters said they had heard at least a little about the Netflix Headquarters Development project. However, in response to an open-ended question that was asked earlier in the survey, only two percent of voters said that the most serious problem facing the residents of Los Gatos was this particular development project. Other issues, such as a lack of affordable housing in the area, were cited as serious problems by a much greater proportion of voters. Despite recent media coverage of the company, voters hold an overwhelmingly positive view of Netflix. By a significant margin, voters were more likely to hold a favorable view of Netflix (73% of voters) than an unfavorable one (15%). Positive attitudes towards the company are also strong: 43 percent of voters said they have a very favorable opinion of Netflix. This information is all the more striking considering the recent controversy over changes to the companys business model. Despite a noticeable backlash from consumers , only four percent of voters in Los Gatos said they held a very unfavorable opinion of the company. Voters aware of the project are overwhelmingly in favor of it. The subset of voters who said they had heard about the project were asked without any further description or elaboration whether they supported or opposed the project. As shown in Figure 2, nearly three-quarters expressed support with 74 percent in favor and only 15 percent opposed. In addition, support among those in favor of the project was strongly-felt: nearly half of those aware of the project (49 percent) indicated that they strongly supported it.

Town of Los Gatos Voter Survey October 2011 Page 3

FIGURE 2: Support for the New Netflix Headquarters (Among the 67% of Voters Aware of the Project)

Once provided with details of the project, more than four in five Los Gatos voters express support. Voters were read the following description of the project:
This project was approved by the Town Council in August, and provides for the replacement of an existing industrial office complex built in the 1970s. It is located on Albright Way and Winchester Boulevard, right next to Highway 85 and the planned end of the Vasona Light Rail line. The new development will include new office buildings, including space to accommodate an expanded headquarters for Netflix and its one thousand employees. It will include up to 168 units of senior housing 20 percent of which will be affordable. The project would also generate millions of dollars per year in tax and fee revenue to fund local schools, transportation improvements, and other community benefits.

Having heard this information, fully 84 percent of Los Gatos voters indicate that they support the project, as down in Figure 3 on the following page nearly eight times as many indicate that they support it.

Town of Los Gatos Voter Survey October 2011 Page 4

FIGURE 3: Support for the New Netflix Headquarters After Brief Description

This support cuts across all major subsets of the Los Gatos electorate. In fact, the project is backed by: 84% of men and 83% of women; 88% of Democrats, 84% of Republicans, and 77% of independents; 88% of renters and 82% of homeowners; 85% of whites and 74% of voters of color; and 84% of voters under age 50 and 84% of voters age 50 and over.

And even after hearing detailed messages from supporters and opponents of the project, voters remain solidly in favor of it. Survey respondents were read a series of statements from supporters and opponents of the project, in rotated order. And while the net effect of the messages was to slightly reduce support for the project, as shown in Figure 4 on the following page, the impact was relatively minor. Even after the messaging, including specific height of buildings, number of floors, and traffic, fewer than one in five voters oppose the project, while nearly four in five (79 percent) express their support, and a majority (52 percent) continues to offer strong support.

Town of Los Gatos Voter Survey October 2011 Page 5

FIGURE 4: Progression of Support After Pro and Con Messages

Position Strongly support Somewhat support TOTAL SUPPORT Strongly oppose Somewhat oppose TOTAL OPPOSE UNDECIDED Initially 55% 28% 84% 7% 3% 11% 6% After Pro and Con Messages 52% 27% 79% 10% 5% 15% 6%

Residents are very pleased with the overall direction of the town. Fully 74 percent say that things in Los Gatos are generally headed in the right direction, while only 13 percent say they are on the wrong track. These figures reflect a remarkable degree of happiness with community conditions relative to other California communities. The survey responses reveal a broad community consensus in strong support of the project. Los Gatos residents are aware of the project, back it in large numbers, and continue to support it even after hearing the case made by the projects opponents. Opposition to the project comes only from a very small minority of Town voters.

Fairbank, Maslin, Maullin, Metz & Associates (FM3) has specialized in public policy-oriented opinion research since the company was first organized in 1981. With permanent offices in Los Angeles, Oakland, and Madison, Wisconsin, the firm conducts research for political candidates, for ballot measure campaigns, and for businesses, non-profits, and government agencies across all fifty states and also in other countries. FM3 has conducted literally thousands of focus groups and surveys throughout its three-decade history, and has provided research and strategic guidance to hundreds of clients in the San Francisco Bay Area, In particular, FM3 has conducted research in many South Bay communities, including previous survey research on behalf of the Town of Los Gatos.