Netflix's crackdown on password sharing will begin in the coming months: All your questions answered

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Netflix is set to crackdown on password sharing on the platform in the coming months, as early as March 2023. Additionally, there are plans to introduce an advertising-supported tier for the streaming platform.

Why is Netflix cracking down on password sharing?

Netflix first announced its crackdown on password sharing in April 2022. 2022 proved to be a rough year for Netflix as the streaming service lost 200,000 customers in the first quarter alone, which marked the first time the platform suffered a loss in subscribers in over a decade.

The company claimed that account sharing was undermining its ability to invest in the platform and build the business. The company said, “Today’s widespread account sharing (100M+ households) undermines our long-term ability to invest in and improve Netflix, as well as build our business.”

What measures has Netflix taken its increase subscriber?

Sine the dip in subscribers, Netflix announced initiatives such as crackdowns on password sharing and a push into advertising with new lower tier membership plans. Netflix also began rolling out its paid password sharing model in countries like Argentina, Dominican Republic, Honduras, El Salvador and Guatemala.

Netflix users in these countries would have to pay $2.99 extra per month to add an extra home to their Netflix account. "From our experience in Latin America, we expect some cancel reaction in each market when we roll out paid sharing, which impacts near term member growth. But as borrower households begin to activate their own standalone accounts and extra member accounts are added, we expect to see improved overall revenue, which is our goal with all plan and pricing changes" Netflix said in its shareholder letter.

Despite the early loses, Netflix revealed that it bounced back, ending the year on a “brighter finish”. The company also drew praise for its fourth quarter revenue, operating profit, and membership growth, claiming that they exceeded expectations.

What does this mean for existing Netflix users?

For one, Netflix will no longer allow password sharing outside a household starting April 2023. So a Netflix account, irrespective of how many screens has been chosen, will only be usable in one household.

However, Netflix will allow users to access accounts in different households with a new paid sharing feature, which is expected to roll out sometime in Q1 2023. While Netflix hasn’t provided any details about pricing outside Latin America, you can expect password sharing to cost less than the price of a new account, making it more convenient and economical for users to share passwords than have multiple accounts.

In areas where paid password sharing is available, users will have to pay an extra fee to use an account outside the primary household. Users will be able to add an extra home to an existing account for an additional fee.

How will Netflix crackdown on password sharing?

Netflix hasn’t revealed details on how it will crackdown on password sharing yet. However, Netflix collects vast amounts of user data and the Netflix will be able to detect password sharing through IP addresses, device IDs, and account activity.

How will the crackdown affect Netflix usage during travel?

The major question on everyone’s mind is how will limiting Netflix to one household work for users accessing the streaming service on the go through a laptop, tablet, or mobile phone. Netflix has confirmed that members will be able to continue watching content on their account while traveling. Additionally, streaming on mobile devices, tablets, or laptops wasn't affected during the trails in Latin America, according to Bloomberg.

Will my sub-account retain recommendations?

During the last quarter of 2022, Netflix announced a new ‘Profile Transfer’ feature that allows users to easily transfer their personalized recommendations, viewing history, ‘My List’, saved games, and other settings to a new account. The new account can be added as an extra member to an existing subscription plan or can sign up for a new membership.

Also Read: Netflix Profile Transfer feature is live: Here’s how you use it

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