The Netflix login page displayed on a laptop screen and the Netflix logo displayed on a phone screen are seen in this illustration photo taken in Krakow, Poland on January 2, 2023.
Jakub Porzycki | Nurphoto | Getty Images
NetflixThe crackdown on password sharing has arrived in the US
The streaming service said it began notifying members of its new sharing policy on Tuesday, noting that Netflix accounts should only be shared within a single household.
“Your Netflix account is for you and the people you live with — your household,” the company said in an email it sent blog on Tuesday.
The email also states that members can transfer the profile of someone outside their household so that person can start a new self-pay membership. Or they can pay an additional fee — $7.99 per month — per person outside their household using their account.
About Netflix subscription plans pagenotes that additional members can be added to its standard and premium plans without ads.
How much do Netflix plans cost?
Here’s how to Netflix prices of their levels In the United States:
- Standard Ad Supported (2 devices at once): $6.99 per month
- Basic (1 device at a time): $9.99 per month
- Standard (2 devices at once): $15.49 per month
- Premium (4 devices at once): $19.99 per month
Netflix was originally expected to launch a crackdown on people borrowing other accounts to create their own profiles at the end of the first quarter, but notice investors and customers called during last month’s earnings call that it was pushing the move until the second quarter.
The streamer said more than 100 million households share accounts, about 43% of its global user base. Netflix said this affected its ability to invest in new content.
Earlier this year, Netflix outlined password-sharing guidelines in four other countries: New Zealand, Canada, Portugal and Spain. Netflix said it will ask members in those countries to set a “primary location” for their accounts, allowing users to set up two sub-accounts for those who don’t live in their home base for additional fees.
In Tuesday’s announcement, the company did not provide such specifics for American households, and rather gave two options, either transferring the profile or paying a fee for an additional member.
The company said it saw an increase in subscribers internationally, where it rolled out such initiatives during the first quarter. But Netflix still managed to add 1.75 million customers during the quarter.
In Latin America, Netflix executives said they saw cancellations after the news was announced, affecting short-term growth. However, they found that these password borrowers later activated their own accounts and added existing members as “other members” accounts. As a result, the company saw higher revenue, the directors said.
Netflix executives have he likened the transition from paid sharing to the transition to increasing prices: people refuse and cancel at first, then slowly come back and write their own accounts.
In addition to cracking down on password sharing, Netflix also recently introduced a cheaper ad-supported tier in an effort to boost revenue. Both measures came in response shortly after Netflix announced its first loss of subscriber in more than ten years at the beginning of 2022.
Media companies across the board have been looking for ways to make their streams profitable, relying on methods like cutting content costs, advertising, and finding other ways to attract more customers to their platforms.