In the upcoming months, Netflix will start prohibiting customers from disclosing their account passwords to anybody outside of their household, the video streaming firm hinted in a letter to shareholders last week.
Last spring, the streaming juggernaut made its first suggestions about intentions to limit household Netflix password sharing.
In Latin American nations, Netflix tested a paid version of account sharing where users could add a “sub-account” for an extra $3 per month.
Paid sharing will now be implemented “more generally later in Q1,” which concludes on March 31st.
“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,” Netflix said in its letter. “But as borrower households begin to activate their own standalone accounts and extra member accounts are added, we expect to see improved overall revenue.”
Netflix currently allows multiple customized profiles to be created under a single account, but the profiles are intended to be used by members of the same household.
“While these have been hugely popular, they have also created some confusion about when and how Netflix can be shared,” Chengyi Long, Netflix’s director of product innovation, wrote in a statement announcing the paid share feature last year. “As a result, accounts are being shared between households – impacting our ability to invest in great new TV and films for our members.”
Netflix’s method for identifying password sharing
According to Netflix, it can identify devices in a household using IP addresses, device IDs, and account activity. According to its existing policy, if a gadget is regularly used outside the home, users may be asked to authenticate it.
Netflix’s recent pricing changes
The announcement of paid sharing’s expansion also comes one year after Netflix raised its prices, boosting the basic $8.99 monthly plan to $9.99 in the United States.
It also rolled out a $6.99 monthly subscription for a version of the service with advertisements in November.