LOS ANGELES.-Netflix, the world’s largest video streaming company, warned that a worldwide campaign against password sharing.
This time it sounds like a serious warning, and it could spell an end to the rampant practice of borrowing login information from a family member, friend, or acquaintance.
Netflix It said it estimates that more than 30 million American and Canadian households use a shared password to access their content.
The company noted that it is likely that more than An additional 100 million households use a shared password around the world.
In his quarterly letter to shareholders, Netflix acknowledged that it has deliberately allowed generous sharing of passwords outside the home because it helped get users hooked on the service.
But with competition from Disney, Warner Bros. Discovery, Paramount Global, NBCUniversal, Apple TV+ and other streaming services hurting its growth, Netflix said it wants the millions of households that share passwords start paying.
Netflix subscribers fall for the first time in a decade and shares plunge 24%
Global streaming giant Netflix Inc. reported on Tuesday a loss of subscribers for the first time in more than a decade and predicted further contraction in the second quarter, a rare setback for a company that has been a reliable growth engine for investors.
Netflix lost 200,000 subscribers in its first quarter, falling well short of its modest prediction that it would add 2.5 million subscribers.
Its decision in early March to suspend the service in Russia after the invasion of Ukraine meant the loss of 700,000 users. Shares of the company slumped 24% in after-market trading.
Netflix’s poor results hit other video-related stocks like Roku, which fell more than 6%; Walt Disney, almost 4% and Warner Bros Discovery, 2%.
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Netflix, which currently has 221.6 million subscribers, had recorded its last customer loss in October 2011.
Netflix offered a grim prediction for the coming quarter, forecasting that would lose 2 million subscribersdespite the return of long-awaited series like “Stranger Things” and “Ozark” and the debut of the movie “The Gray Man,” starring Chris Evans and Ryan Gosling.
Wall Street was targeting 227 million customers for the second quarter, according to Refinitiv data.
First-quarter revenue grew 10% to $7.87 billion, slightly below Wall Street’s forecast of $7.93 billion. Net earnings per share was $3.53.
“The large number of households that share accountscombined with competition, is creating revenue headwinds to the upside,” said Netflixexplaining the difficulties in attracting new customers.
The streaming service was expected to see slowing growth, amid intense competition from Amazon.com, Walt Disney Co, the newly formed Warner Bros Discovery Inc and deep-pocketed newcomers like Apple Inc.
Streaming services spent $50 billion on new content last year in an attempt to attract or retain subscribers, according to researcher Ampere Analysis. This represents an increase of 50% compared to 2019.
As growth slows in mature markets like the United States, Netflix is increasingly focusing on other parts of the world and invest in content in local languages.