Netflix cracks down on password sharing by charging subscribers to add extra homes

midian182

Posts: 8,328   +103
Staff member
A hot potato: Sharing Netflix account passwords with friends and family is something many subscribers do, but the streaming giant isn't happy about all that lost potential revenue. In its latest attempt to address the issue, Netflix is asking customers in five South American countries to pay an extra fee if they want their accounts used in additional households. Should the test prove successful, the scheme could be expanded globally.

Earlier this year, Netflix said password sharing was one of the primary reasons why it lost subscribers—around 200,000—for the first time in a decade, noting that more than 100 million households regularly use accounts paid for by others. The company said the practice is "impacting our ability to invest in great new TV and films."

Bloomberg writes that Netflix is now asking customers in Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic to pay an extra fee if their account is used outside their primary residence for more than two weeks.

Netflix knows that many people like to access their accounts while on vacation, so the fee won't be applicable when traveling, as long as the account has not been previously used in that location. This is allowed once per location per year. Moreover, the new restriction won't affect users on mobile devices such as smartphones, tablets, or laptops.

As for the pricing, it's the equivalent of $1.70 in Argentina and $2.99 in other countries—that's per month per extra household. It's also possible to add additional homes based on what plan users are on: A Basic plan allows one; Standard plans give you two; and Premium plan subscribers can add four different homes.

The latest experiment is different from the one Netflix launched in Chile, Costa Rica, and Peru back in March, which cost between $2 and $3 per month. The 'extra member' option allows subscribers to add up to two new people to their account, who then get a sub-account tied to their email address, their own stream, and the ability to watch Netflix at the same time as the primary account holder. But this has reportedly led to confusion over what constitutes a household.

Netflix says it identifies homes using IP addresses, device IDs, and account activity. If an account is being used outside of the primary residence for longer than two weeks, holders will be notified to add the household or change their primary address to a new one; otherwise, that TV will be blocked.

In addition to generating extra revenue from password sharing, Netflix is partnering with Microsoft to introduce its cheaper, ad-supported tier later this year.

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Jrfeimst2

Posts: 50   +61
Netflix will probably just loose even more subscribers. I can’t wait to hear their excuse. Netflix is the most expensive streaming service and they seem to be the only one crying and whining about this issue. Maybe I should send them some cheese with their wine. The reason you loose subs is because well most of your stuff is crap and over priced. Duh 🙄
 

Ravey

Posts: 370   +168
So this.. and they want us to pay for adverts too (on the lowest tier)...

I have kids that like to watch Netflix when they go for a sleepover at a friends house. I'm not paying extra for that!
 

R00sT3R

Posts: 745   +2,314
I’ll cancel mi sub if they do that and just download the two shows I watch.

These streaming services are now in a race to the bottom until it all collapses in on itself and the mergers between them will begin again, launching rebranded, refreshed services, with no ads and unlimited household viewing.

Until we reach that bottom, their services will continue to worsen for the consumer.
 

Hexic

Posts: 1,266   +1,994
TechSpot Elite
I wonder if this will cause any problems for people that have ISPs that don't use static IPs?

They'll still be able to map an account to location with the locational IP, hardware ID (I.e. MAC address) and usage patterns. Between those three metrics they can get a pretty accurate idea of where you are and what's using their service.
 

hwertz

Posts: 200   +119
Sounds dumb! The solution seems perfectly fine to me of allowing x simultaneous streams, if someone "over shares" their account it becomes unusuable because your stream cuts off as soon as the next user starts their stream, and the various users will keep cutting off each other's streams. Simple and effective.

Adding an additional stream for a few $ a month, that's a feature and they may get people to pay it. Cutting people off from using the stream they are paying for, because that usage is split between a few locations? Screw you Netflix.

Just to add, I like Japan's solution to streaming services -- new shows are exclusive to the network that made them for like a year. The streaming services there found people were not subscribing to any of them, because people did not want to subscribe to a service that has like 1/5th of the shows, and they didn't want to subscribe to 5 or 6 different services either (sound familiar?) So now, new shows are exclusive to the network that made them for a year or so (so there's still an incentive to make popular new shows), but then they go to all streaming services after a year (... they found the total number of subscribers went up so much, some streaming services might have lost percentage market share but their absolute number of subscribers went up so massively after this change they simply didn't care.) I'm in that position, I've been very unimpressed at the selection of any individual streaming service, ZERO interest in paying just to find "Oh, they don't have this show, or this one, this one is only season 5 and 6", a pirate's life for me. But if I could subscribe to one service and get a full selection? Yes please.
 
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wiyosaya

Posts: 8,273   +7,638
Just to add, I like Japan's solution to streaming services -- new shows are exclusive to the network that made them for like a year. The streaming services there found people were not subscribing to any of them, because people did not want to subscribe to a service that has like 1/5th of the shows, and they didn't want to subscribe to 5 or 6 different services either (sound familiar?)
In the US, streaming services have not figured that out, yet.

As I see, streaming services in the US still think that to their customers, streaming is a fad that those same customers cannot live without. At the same time, the streaming services think their customers are willing to pay anything for the content they provide. The streaming services have failed to get that most streamers switched away from cable and satellite because the cost was far too high for the value provided by watching only a few channels regularly.

One day, maybe, we can hope that they will finally ask their customers why they choose streaming instead of them assuming that streaming is a fad that no one can resist.