Netflix Launches Campaign Against Password Sharing In US, Other Regions

Netflix's crackdown on password sharing is now starting to reach users in the United States and other developed countries after a long delayed rollout. 

The streamer had initially intended to roll out "paid sharing" to US members in the first quarter of this year, but it had to postpone the launch date until after experiencing cancellations in regions where it had already implemented the changes. 

U.S. consumers will now have to decide whether to terminate other people's access to their Netflix account or pay $7.99/month for an extra subscription for individuals who are not in their primary household.

In the upcoming weeks and months, similar adjustments will be implemented across a number of international markets.

The firm provides tools to help with this transition, such as a means for current customers to see which devices are logged into their accounts and delete those that shouldn't have access, as well as tools to change their password.

A "Transfer Profile" option will let users who share a Netflix account with someone else to move their current account data, such as their watchlist and watching history, to their new account.

Netflix told investors that despite some early cancellations, it believes the password restriction would be good to its long-term growth as a company and to its financial health.

The feature has been received with strong consumer reaction.

For instance, Netflix co-CEO Greg Peters stated during the company's first-quarter earnings that the outcomes of the password enforcement in its first supported regions resembled how users reacted to price hikes.

“We see an initial cancel reaction and then we build out of that, both in terms of membership and revenue as borrowers sign up for their own Netflix accounts and existing members purchase that extra member facility for folks that they want to share with,” Peters told investors on the earning call in April.

“So, first of all, it was a strong validation to see consistent results in these new countries, because there are different market characteristics different from each other and also different from the original Latin American rollout countries,” he added.

Prior to earlier this year's expansion of access to Canada, New Zealand, Portugal, and Spain, Netflix had started testing the function in Latin American regions.

It will now be accessible in a wider range of international marketplaces, including those in Brazil, Bolivia, Belize, France, Germany, Iceland, Ireland, Italy, the Philippines, Malaysia, Israel, Thailand, Taiwan, Switzerland, Sweden, and other countries.

The corporation may have postponed the crackdown in Q1 so as not to further harm net additions. To achieve a total of 232.5 million accounts worldwide, the business recorded a net rise of 1.75 million global subscribers in the most recent quarter, which was lower than Wall Street's forecast of 3 million.

During results, it also said that it intended to "on or before" June 30 roll out the password-sharing adjustments to U.S. members.

It appears like Netflix was able to slightly advance the schedule.

The email will be sent to Netflix subscribers in the US who are sharing their accounts, the company said today on its blog.

“A Netflix account is for use by one household,” the company admonishes.

“Everyone living in that household can use Netflix wherever they are — at home, on the go, on holiday — and take advantage of new features like Transfer Profile and Manage Access and Devices,” the post reads.

The email itself, with the subject line "An update on sharing," only lists the various choices and directs recipients to additional support materials if necessary.

Netflix explains that it is "now starting to roll out updates to sharing to countries around the world, including the U.S." in an email to the press.

Netflix has yet to see the consequences of recovering following a password crackdown in the U.S., its biggest and most important market, where it confronts growing competition for consumers' time and money. Earlier testing suggested Netflix may do so.

The announcement's timing is significant since today, HBO Max becomes Max, a new service that unifies HBO and Discovery+ content under one roof, substantially increasing the quantity of material that is available.

The addition of Showtime to Paramount+ will take place on June 27 of next month.

Disney has announced intentions to merge Disney+ and Hulu into a single app.

Even while certain adjustments could result in price hikes, members receive additional material as a result.

While this is going on, Netflix is charging extra for the same thing.