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In Early 2023, Netflix Will Crack Down on Password Sharing

Netflix Will Crack Down on Password Sharing

Starting in 2023, Netflix will make it harder for people to share passwords. After letting users move their profiles to new accounts, the streamer says that starting next year, subscribers will be able to make sub-accounts. This is part of its plan to “Monetize Account Sharing” more widely.

According to Netflix’s earnings report released today, the business attracted 2.4 million customers during the most recent quarter as the streaming service prepares to introduce its ad-supported tier next month and crack down on password sharing. The number of paid members has increased by 104,000 in the United States and Canada over the past three months, compared to 73,000 over the same period last year, and the company claims it is dedicated to the “bingeable release model.”

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This year, Netflix reported losing members for the first time in over a decade, with the company’s subscriber count falling by an additional 1.3 million in the U.S. and Canada and 1 million globally in the most recent quarter.

Netflix has also been gradually discouraging subscribers from password sharing. Netflix performed tests that required users in Chile, Costa Rica, and Peru to pay extra for a sub-account if someone outside of their family was using their subscription.

Additionally, it experimented with a method allowing customers in Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic to purchase additional “Homes” for accounts situated outside the subscriber’s primary residence.

After testing it in other countries, Netflix recently rolled out a Profile Move feature that allows users to effortlessly transfer their personalized recommendations, watching history, My List, and other settings to a new account. Last month, a report from Rest of the World exposed the frustration of Latin American customers subject to the tests.

The streaming giant revealed last week that it will launch its Basic ad-supported plan on November 3 in the United States, Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico, Spain, and the United Kingdom for $6.99 per month.

Netflix has partnered with Microsoft to provide customers with advertisements that will last between 15 and 30 seconds. This new tier does not provide access to Netflix’s entire library due to licensing restrictions.

Additionally, basic users cannot download any content to their devices and can only view videos in HD. Notably, the company’s ad-supported tier debuts before Disney Plus’, which is scheduled to launch on December 8.

As competitors such as Disney, Warner Bros. Discovery, Paramount, and NBC expand their content libraries and paying subscriber bases, Netflix remains convinced that its business model will exceed those of its rivals. “It is difficult to develop a significant and lucrative streaming business – our best estimate is that all of these competitors are losing money on streaming, with yearly direct operating losses in excess of $10 billion compared to our +$5-$6 billion operating profit.”

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Davie Bancroft is an accomplished author with a strong focus on investment and the tech business landscape. With extensive knowledge and experience in these fields, he provides valuable insights into emerging trends and opportunities. Davie's writings explore the intersection of technology and finance, offering practical advice for investors and entrepreneurs. His expertise and analytical approach make him a trusted resource for those seeking to navigate the dynamic world of investments and tech startups.