Netflix will soon start restrictions on password sharing in the first quarter of the year. This plan was discussed after the company released its earnings report last week. The streaming giant will make password sharing a bit complicated for users, and might include an additional fee.
Password sharing is a common habit in many households, and this plan seems to limit the extent of how users under one roof can maximize their subscriptions. This will most likely target a single account across multiple locations.
Netflix Will Implement Extra Charges For Password Sharing
Netflix shared during their shareholders’ meetings that they recognize this is a drastic change for members who share their subscriptions with others.
“As we roll out paid sharing, members in many countries will also have the option to pay extra if they want to share Netflix with people they don’t live with. As is the case today, all members will be able to watch while traveling, whether on a TV or mobile device.”
Stricter rules were tested on selected Central and South American countries, and as expected, the company received negative reactions.
“As we work through this transition – and as some borrowers stop watching either because they don’t convert to extra members or full paying accounts – near term engagement, as measured by third parties, like Nielsen’s The Gauge, could be negatively impacted.”
Netflix’s director of product innovation, Chengyi Long, wrote a blog post regarding the new system that the streaming giant will attempt to implement. It says only one home will be permitted to use a single Netflix account, which they can use across multiple devices. If they want to add another household to the billing, an additional monthly fee will apply. If the user is traveling, they can only access the app using a mobile, tablet, or laptop.
She claimed that users’ practice of password sharing undermines their long-term ability to improve the app’s service. The director also noted that they are exploring ways for people who want to share their accounts and are willing to pay the extra price.
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Netflix Expects Negative Reaction Amidst Banning Of Password Sharing
Netflix reportedly lost 200,000 subscribers in the first quarter of 2022. This is due to a number of factors, such as the war in Ukraine and other competitions in the streaming industry. Chengyi Long did not mention how Netflix would go about their new regulations, but according to Netflix co-CEO Greg Peters via Variety:
“This will not be a universally popular move. [There will be] a bit of cancel reaction to that.”
As one of the biggest streaming platforms today, Netflix continues to innovate more ways to invest in their product while bringing quality shows right at the tip of our fingers. Although, this plan to cancel password sharing will definitely cause major outrage from their subscribers.
Source: The Guardian, Variety
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