Netflix says at least 100 million people are sharing their passwords, and it wants to monetize that
Netflix will finally introduce a paywall on password sharing in early 2023, according to The Wall Street Journal.
The publication cites multiple sources who say the streaming giant will roll out the change first in the U.S. before, presumably, expanding to other markets.
Earlier this year, Netflix confirmed that it would begin making customers pay to share their accounts with others, claiming that as many as 100 million people had been doing so for free. While Netflix’s terms of service have long stipulated that users don’t share their passwords with others, the company hasn’t actually ever enforced that.
Interestingly, though, WSJ reports that Netflix researchers warned the streamer that password sharing was eating into subscriptions way back in 2019, but it didn’t want to alienate customers by cracking down on this. The service’s initially significant growth amid the COVID-19 pandemic also put off any potential plans to introduce a paywall.
But earlier this year, Netflix reported its first quarterly subscriber losses, all while rival services like Disney+ continued to grow in popularity. As a result, the company has finally decided to push forward with a paywall. The first step in these efforts was a test in a three countries — Peru, Chile and Costa Rica — in which it would cost around $3 to $4 Canadian to share your account with two people.
In October, a Netflix spokesperson told MobileSyrup that the company currently had no plans to bring the test to Canada. That said, the WSJ‘s new report about Netflix’s initial U.S. rollout plan seems to suggest an international expansion wouldn’t be too far off.
For now, though, the company has a new, less expensive ad-enabled tier in Canada, the U.S. and other markets. At a cost of $5.99 CAD/month, Netflix ‘Basic with Ads’ offers most of the Netflix film and TV series catalogue with ads playing roughly four to five minutes every hour. That said, Gizmodo reports that only nine percent of new U.S. Netflix subscribers actually opted for the entry-level membership last month.
Source: The Wall Street Journal