Netflix is beginning to officially crack down on password sharing in the United States. On Tuesday, the company began sending emails to users reading that an account is “for you and the people you live with - your household.”
“A Netflix account is for use by one household,” the streaming giant wrote in a blog post announcing the change. “Everyone living in that household can use Netflix wherever they are — at home, on the go, on holiday — and take advantage of new features like Transfer Profile and Manage Access and Devices.”
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The crackdown on password sharing - a practice the company once vehemently encouraged - has been a long time coming. Netflix announced its plans to limit the practice in 2022, saying at the time it had been working for a year to “enable members who share outside their household to do so easily and securely, while also paying a bit more.” The company then rolled out paid password sharing on the international market. Netflix said they initially experienced cancellations, but ultimately saw users come back.
"As with Latin America, we see a cancel reaction in each market when we announce the news, which impacts near term member growth," the company said in a letter to shareholders, according to NPR. But as borrowers start to activate their own accounts and existing members add 'extra member' accounts, we see increased acquisition and revenue."
Netflix, which boasts it has around 235 million subscribers worldwide, says that some 100 million accounts share passwords. Now, if a subscriber wants to continue allowing someone to use their password, they’ll have to pay an extra $7.99 a month. Paid subscribers can add up to two people they don’t live with to their accounts.
Netflix has said that password sharing has impacted its “ability to invest in great new TV and films for our members.” In 2022, the company reported a loss of subscribers for the first time in 10 years, though those numbers bounced back in the first quarter of 2023. The company meanwhile reported revenue of $8.2 billion in the first quarter of 2023, up from $7.9 billion in the first quarter of 2022.