Netflix’s password-sharing days are over.
An announcement on the streaming platform’s website stated that it would crack down on household sharing.
Pete Pachal, CoinDesk’s Chief of Staff for Content, warned that “other services are watching very closely” to see what happens following the move of the streaming giant.
Netflix clarified its rules for members who share passwords with others outside their household in an email sent to them on May 23, 2023.
A Netflix account can only be used by one household. “Everyone living in this household can use Netflix anywhere — at home or on the road, even on vacation — and benefit from new features such as Manage Access and Devices and Transfer Profile,” it said.
Pachal discussed how Netflix’s decision could affect the streaming services industry.
He said, “The era where subscribers grew rapidly is over.” “Like the rapid growth of everyone’s subscribers, their numbers are leveling off.” They’re not getting as many subscribers.
He continued, “It is funny that the other streaming services don’t seem to have focused on Netflix as much.” Amazon Prime has tweeted a few times about them, but the other streaming services have not. I believe that’s because they are watching Netflix closely and trying to determine if it will work in terms of growth after the initial dip.
Tech analyst warns that other companies could adopt similar strategies if Netflix’s crackdown is successful.
“I think that a lot of other services would follow suit if this happened, because why not?” “If you could get more revenue by doing this, you’d do it,” said he.
Pachal explained Netflix’s plans for the new rules of the household.
If you attempt to log in to your Netflix account from another location or location other than your home, you will be asked, “Is this your primary location?” This account is for members of the same household.
Users can change their location when on vacation or if they have a second home.
Netflix also warns that it will monitor location changes.
The problem is that if you do this back and forward, back and forth between the two locations, it will be detected pretty quickly and you’ll be shut down.
Pachal said that Netflix is looking to increase revenue by adding more subscribers to its plans. It has also faced consumer backlash for encouraging password sharing in the past.
He said that many people are saying they will leave the service because they feel they would be competing with their customers.
He said that initially the move may negatively impact Netflix, but it could grow in the future.
He said, “They will probably experience some losses during the first few weeks and months.” After the initial drop in subscribers, they actually increase at a rapid rate. People will either get over the initial drop and add more members, or they’ll create their own accounts.
He added, “If this is true, Netflix could enter another period of massive growth, but it’s a bit risky.”