Your mother in Quebec, your childhood friend in Rimouski and your neighbor “borrow” your Netflix account to watch TV? Someone will soon have to pay for your generosity. This was announced by the streaming service, which intends to regulate the sharing of passwords within a year to curb its loss of subscribers.
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Of its 220 million subscribers worldwide, Netflix estimates that 100 million share their accounts, either with family members or friends. We are not talking here regarding people who live under the same roof and who each have their own profile, but people from different households, who would normally have to pay for their own television account.
A share so far useful for Netflix
The statistics are surprising. While you only need to illegally download a TV series from the Internet once to receive an email from HBO’s lawyers, Netflix has instead let the situation get out of hand for years.
For the American company, sharing has so far been seen as a blessing in disguise: the television equivalent of a free sample at Costco. Granted, Netflix was losing potential revenue this way, but many of those shared accounts were to users who probably wouldn’t have tried the service otherwise.
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The need for growth is a game-changer
As long as Netflix was growing at breakneck speed, the game was worth the effort. The situation changed, however, when the company’s latest financial results were unveiled in April: for the first time since the launch of the online service, its number of subscribers fell.
It’s not really his fault. Inflation, the war in Ukraine and above all the increasingly fierce competition in this industry, especially since the arrival of Disney+, are rather to blame for this drop. The news was nevertheless greeted with a brick and a beacon by the financial markets, to the point of causing Netflix’s share price to fall by 35% in one fell swoop. Tackling shared passwords is an easy and fast way to gain new paying subscribers and get back to business growth.
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An official sharing to be expected
Contrary to what has sometimes circulated so far, however, we should not expect the complete end of account sharing, but rather its formalization.
It’s still unclear how Netflix will go regarding this, as the company wants to try different solutions over the next year to best monetize these shared accounts. The work has already begun. Subscribers in Chile, Peru, and Costa Rica, for example, can export profiles and pay extra (regarding $3-$4) to add a user to a folder.
The challenge now is to find the best recipe for charging subscribers who share their account in a way that encourages those who have never paid to do so, without making the offer so attractive as to convince those who pay top dollar. to group together to share their account in turn.
