Will Netflix Crack Down on Password Sharing?

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Since its creation in 1997, Netflix has grown to be the biggest name in streaming services, and even with the flood of new services into the market, they’ve remained dominant. One thing that takes away from the company’s revenues, however, is the large number of users who share their accounts with others. Will Netflix be cracking down on password sharing? Read on below to find out.

What have they said so far?

Netflix hasn’t officially confirmed that there will be a large-scale crackdown on account sharing, but they’ve taken a few steps recently that seem to suggest a change is coming.

The company has recently added a feature that prompts users to sign up for their own account if they aren’t with the person who pays for the subscription. In an official statement, a spokesperson from the company said, “This test is designed to help ensure that people using Netflix accounts are authorized to do so.”

Netflix has never worried about password sharing before

In the past, Netflix has ignored people sharing passwords with each other and provided upgraded plans that let users watch on multiple screens at the same time.

It’s possible that Netflix chose to let password sharing slip for a while to help itself become such a big name in most American households. They could now have decided that the service is important enough in users’ lives that many users will sign up for new accounts if they aren’t allowed to share.

Is password sharing a problem?

A study conducted by research firm Survata found that 31% of Netflix users use someone else’s account instead of paying for their own. It may seem like sharing your password with a family member doesn’t make a significant difference but on a broad scale, this hurts the company’s revenues significantly. 

Netflix’s falling numbers

2022 has been a rough year for Netflix so far, as the company has seen a significant decline in both its stock price and its user count. Netflix stock saw an all-time high of $691 per share in November of 2021 but has since dropped drastically to under $200 at the time of writing.

This drop may be in part due to the broad reopening of the economy as the COVID-19 pandemic subsides. Many people who were remote employees during the pandemic are returning to their regular in-person jobs, and people are returning to their usual hobbies and activities that were replaced by television for the last few years.

How can Netflix stop password sharing?

It’s unlikely that Netflix can do anything to completely eliminate its password-sharing problem, but there are many measures they can take to reduce it.

One of these measures is adding more subscription tiers with ads or limited offerings for those who don’t want to pay the full price of a standard membership. Netflix could also enforce the number of devices that can be signed into one profile instead of the number that can be watching at once.

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