What you need to know
- Netflix is looking to add an additional fee for those lending their passwords to a family member or friend.
- After testing in Latin America, Netflix is looking to bring this idea to the U.S. market in early 2023.
- The company reports there are 100 million viewers watching Netflix off a borrowed account and many Latin American testers are not too happy with this change.
Netflix is looking to bring an end to the current lifestyle of sharing an account's password.
According to the Wall Street Journal, researchers from within the walls of Netflix are interested in solving its "major" password-sharing problem in 2023. The streaming platform states that there are 100 million viewers of its content using a borrowed password. So, to quell this, Netflix will be ushering in an additional fee for those wishing to share their accounts with other people in 2023 in the U.S.
Netflix has been testing this new way of sharing passwords in Latin America. For those users, the company has allowed them to pay for sharing an account with up to two people who do not live in their homes. The borrower would then need to enter a verification code that Netflix would provide to the owner of the account before they can watch their show or movie. And this code would need to be entered within 15 minutes before expiring.
Netflix has also tested ways to get a handle on families that are split, such as children visiting each adult figure separately. The running idea is to alert Netflix if they are going to be shifting their geographical location for any given period of time.
Another issue the streaming platform has found comes from the Indian market. A person close to the matter states that with many people in India watching Netflix off of their phones, it's difficult to determine if they live in the same house as the account holder or not. It's a much easier bit of information to verify if they are streaming over Wi-Fi or a wired connection, instead.
The Wall Street Journal cites Netflix Co-CEO Ted Sarandos, who said, "make no mistake, I don't think consumers are going to love it right out of the gate." This would probably be true for U.S. viewers as well, considering those in Latina America have already complained about this change.
If you remember Netflix's Q3 2022 earnings report, this way of monetizing password sharing is basically its proposed "sub-accounts" plan. It was back in October that Netflix brought up the idea of sub-accounts, which sounds exactly like what was being tested already in Latin America. Netflix said it has plans to bring it to the U.S. market in early 2023, although it has not detailed when it would launch or its pricing.
To prepare for the eventual move, Netflix recently made it a lot easier for password borrowers to transfer their Netflix account from their friend/family member that actually held the account to their own account.
