Netflix, the world's leading streaming platform, has revealed more information about its latest efforts to stop its members from sharing passwords outside their households. This has come in light of a growing concern among the company's shareholders and stakeholders, as password sharing undermines Netflix's ability to invest in and improve its service and grow its business.
According to the "Sharing Your Netflix Account" pages on the Help Center of the company, only those who live with the primary account holder at their primary location are considered as part of the household and can access the account. Anyone who doesn't fall under this category will have to get their own account or become an "extra member" of the original account holder. The cost of adding an extra member to a standard or premium plan is less than the basic plan and will be charged to the original account holder.
The Help Center also stated that when an account is accessed persistently from another location that is not part of the primary location, the device may be blocked from accessing Netflix. To detect devices linked to the primary location, Netflix uses IP addresses, device IDs, and account activity.
The company said that to associate a device with a primary location, one needs to connect to the Wi-Fi at their primary location, open the Netflix app or website, and watch something at least once every 31 days. These devices are then considered as "trusted devices" and allow users to stream content on Netflix even when they are not at the primary location.
However, for those who are traveling or living between different places, they can still use Netflix by obtaining a temporary access code or updating the primary location of their account. The company revealed in a January 19th shareholder letter that over 100 million households engage in account sharing, and it plans to launch the new paid-sharing system more broadly in the first quarter of 2023.
Netflix said that while the expansion of the paid-sharing system may have some negative impacts on engagement in the near term, it expects engagement to grow over time. The company's total subscriber count at the end of Q4 2022 was 230.75 million, compared to 221.84 million reported in the same period in 2021.
In conclusion, Netflix's new restrictions on account sharing aim to ensure that the company can continue to invest in and improve its service while also growing its business. The company's new paid-sharing system is expected to launch in the first quarter of 2023, and while it may have some negative impacts on engagement in the near term, it is expected to grow over time.
