Netflix has revealed the start date of their password tightening initiative.
Netflix revealed in its Q4 2022 financial report (opens in new tab) that it will begin rolling out its paid sharing option "more broadly" in Q1 2023. In layman's terms? Netflix will begin cracking down on household password sharing in March, after its Q1 2023 phase concludes.
Netflix apparently planned to apply the policy by the end of 2022. It evidently missed that deadline, but that hasn't stopped it from moving on with its plans to prevent your friends and family from using your account. You know, assuming you've given them your password and account information.
So, why is Netflix discontinuing password sharing? Essentially, the streaming firm believes that it is undermining its position as the finest streaming service in the world. In Netflix's words, widespread password sharing among millions of customers "undermines our long-term ability to invest in and grow" its platform.
Netflix, predictably, does not expect its password cracking program to be popular.
The program was tested in sections of Latin and South America last year, but it was not warmly received by customers in both regions. Netflix's efforts to entice consumers to sign up for its "add an extra member" function did not help matters. The add-on, which allows consumers to charge a nominal fee to add different households - and all of its residents - to their accounts, further complicated matters.
Speaking after Netflix's Q4 2022.
Speaking after Netflix's Q4 2022 and yearly financial numbers were disclosed, new co-CEO Greg Peters said (opens in new tab) that the company's crackdown on password sharing "will not be a universally popular action". As a result, Netflix anticipates that many users will temporarily close their accounts.
However, the streamer's executive team believes those users will return when a new and popular TV show or movie is published. Megahits such as Stranger Things season 4, Wednesday, and Glass Onion: A Knives Out Mystery helped Netflix boost its membership base by 7.66 million in Q4 2022, indicating that officials are confident that consumers who leave will return at some point.
Netflix also anticipates a surge in new customers as a result of its intention to prohibit password sharing.
If "account borrowers" (as Netflix refers to them) lose access to its limitless material, they will have to create their own accounts. It's a sound strategy, but it's not without risk, since it might inspire some audience members to pirate Netflix TV series and movies instead.
The streamer's Q4 2022.
The streamer's Q4 2022 report does not break down how many of its 7.66 million new subscribers were returning customers, making it difficult to determine whether Netflix's frequent warnings about an impending crackdown convinced "account borrowers" to purchase their own membership. We'll see whether Netflix ever decides to segment its subscription data into new fans and returning customers sub-categories, but we're not holding our breath.
Netflix's planned ban on password.
sharing isn't the only change that will take effect. Netflix stated during its most recent results conference that co-founder Reed Hastings will step down as CEO. Hastings will continue to serve as Netflix's executive chairman, while Peters and Ted Sarandos will take over as co-CEOs to lead the streaming behemoth into a new era.
Meanwhile, if you're interested in acquiring an account, Netflix has slightly modified which membership options you'll see - at least initially. We recently revealed that Netflix does not want you to sign up for its ad-free basic tier, but there is a workaround if that's the account you want. Oh, and it's been canceling yet another thing since 2023 began.
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