In the US, Netflix now offers paid account sharing. Your expected financial outlay
In the US, the crackdown on sharing Netflix passwords has started.
Netflix is implementing account-sharing limitations in the US just months after enforcing new regulations in Canada, Spain, Portugal, and New Zealand.
According to the streaming service, sharing accounts is only permitted for household members. So, if you want to share your Netflix account with someone who doesn't reside with you, you have two choices: move their information to a new membership or share your account for an extra $8 per month.
A Netflix email to US users stated, “Your Netflix account is for you and the people you live with within your household.”
The monthly cost is more than the ad-supported plan's $7 monthly fee but lower than the basic ad-free plan's $10 monthly cost. Monthly fees for basic plans are $15.49, while those for premium plans are $20.
Shared password policies for Netflix
The well-known streaming service is used to promote sharing Netflix login information with close relatives and friends. However, it has changed its tune as subscriber growth stalled in the face of increased competition and a reversion to viewing habits from before the pandemic. It is currently attempting to get a few extra dollars from freeloaders.
Ted Sarandos, co-CEO of Netflix, stated to the Toronto Star on April 6 that “this is a way of getting people who watch and enjoy Netflix to also contribute to the future of content.”
According to Cowen Senior Research Analyst John Blackledge, the move might result in Netflix adding 2.1 million new U.S. members. According to Nielsen, 7.3% of all TV viewership in February 2023 was on Netflix.
The password-sharing plan, according to Moody's Investors Service, may result in “short-term subscriber discontent and disruption but presents the company with a material revenue growth and margin expansion opportunity.”
According to Wells Fargo Securities, compensated password sharing may present Netflix with a greater revenue possibility than consumers signing up for their ad-supported subscription.
Will you spend money on a Netflix subscription?
According to a survey by New Street Research of paying. And non-paying Netflix users, more than half of respondents, or 54%, say they would pay for their own subscription if their access were terminated. Additionally, 70% of respondents say they would choose an ad-free subscription. And 37% say they would pay extra for people who don't live in their household. Despite being a tiny sample of Netflix customers overall in the US, New Street Research believes the findings are encouraging for password restrictions.
Will you stop using Netflix?
However, there is considerable risk. After cracking down on password sharing in February, Netflix lost more than one million Spanish members in the first three months of 2023, according to market research firm Kantar.
Although there had been a lot of cancellations, Netflix informed investors that customers had started adding “extra member” accounts. According to the corporation, there are now more paying subscribers in Canada than there were previously.
Netflix is cracking down on password sharing, but why?
According to a Parks Associates survey conducted in 2022. 40% of internet users in the United States share or utilize shared credentials, up from 27% in 2019.
According to the corporation, 100 million people use another person's account to access Netflix.
According to Citi analyst Jason Bazinet, streaming services lose around $25 billion annually. About 25% of that lost money can be attributed to Netflix.
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