Netflix Cracking Down on Password Sharing

Netflix has quietly begun cracking down on the sharing of subscriber passwords among non-paying users. As the SVOD pioneer surpassed 203 million subscribers through 2020, so too has the market become crowded, adding tens of millions of subs each at industry newcomers Disney+, HBO Max and Peacock, among others.

Subscribers have begun seeing emails from Netflix reminding them about not letting non-subscribers use their password.

“If you don’t live with the owner of this account, you need your own account to keep watching,” read the email.

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With a saturated market, Netflix’s ability to grow its subscriber base — key to sustaining content spend and stock valuation among investors — is slowly being undermined by password sharing. More importantly, shared passwords reportedly cost Netflix as much as $135 million in lost revenue. Research firm Magid contends 33% of all Netflix customers share their password with at least one other person.

Currently, multiple users can share one account by setting up different viewing profiles using one login. Users must purchase premium plans to watch Netflix on more than one screen.

Back in 2019, Greg Peters, chief product officer and chief technology officer, said Netflix was looking for ways to limit password sharing. As a result, the service is testing select subscribers nationwide to address password sharing.

“This test is designed to help ensure that people using Netflix accounts are authorized to do so,” a spokesperson said in a statement.

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