Netflix Says Password-Sharing Charges Probably Coming in Q1

  • Netflix told shareholders it planned to start rolling out paid account sharing later this quarter.
  • It’s trying to stop users from sharing passwords for free with people outside their households.
  • It follows a trial in Latin America where Netflix charged $3 a month to add users outside the home.

You may have less than 10 weeks left to share your Netflix password with people outside your home before the company starts charging for the privilege.

Netflix first hinted at a crackdown on password sharing in July after its first subscriber loss in over a decade — 200,000 users — during the first quarter of 2022.

In a letter to shareholders Thursday, Netflix said it expected to “roll out paid sharing more broadly” later in the first quarter. This means that by the end of March, it’s possible you won’t be able to give out your password for free.

Netflix said account sharing affected over 100 million households, which “undermines our long term ability to invest in and improve Netflix.” It added that while its terms of use already limited account use to a single household, “we recognize this is a change for members who share their account more broadly.”

“As we roll out paid sharing, members in many countries will also have the option to pay extra if they want to share Netflix with people they don’t live with,” the shareholder letter said.

Subscribers will be able to transfer a user profile to a new account, it added.

Paid sharing has already been trialled in Costa Rica, Chile, and Peru, where it costs $2 to $3 to add an extra member account for someone living outside a given household. Peruvian Netflix subscribers told Rest of World that the policy was confusing and they hadn’t been subject to any enforcement of the rule.

The shareholder letter said some Latin American users canceled their subscriptions as a result of the sharing charge. Netflix added that it expected near-term engagement to fall. But as people who borrowed accounts begin subscribing themselves, overall revenue should improve, it said.

The planned broader rollout of the sharing charge follows the November launch of an ad-supported subscription tier, where users are shown up to five commercials an hour. At $7 a month, “Basic With Ads” costs $3 less than the cheapest ad-free tier.

Netflix did not immediately respond to a request for comment.

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