Netflix plans to enforce rules preventing password sharing “more broadly” in the first quarter of 2023, which could mean the rules will come into force in March or April.
The streaming giant released its Q4 2022 earnings on January 19th and detailed the password-sharing plans in its earnings report (spotted by The Verge). The report says:
“Later in Q1, we expect to start rolling out paid sharing more broadly. Today’s widespread account sharing
(100M+ households) undermines our long term ability to invest in and improve Netflix, as well as build
our business. While our terms of use limit use of Netflix to a household, we recognize this is a change for
members who share their account more broadly.”
The report goes on to highlight features Netflix is developing, such as the ability to transfer a Netflix profile to a new account or the incoming paid sharing capability that will let users pay extra to share Netflix with people they don’t live with. Moreover, Netflix warns that it expects the transition will negatively impact engagement in the “near term” but that in the long term, the change will lead to “improved overall revenue.”
Netflix has already been testing paid password-sharing features in several countries, including Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic. Those tests have given us a glimpse of how paid password sharing might work when it rolls out more broadly.
Along with paid password sharing, Netflix added a cheaper ad-supported tier in a bid to keep subscribers.
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