A “verify later” option let users keep streaming even if they didn’t have the code, but still, the test certainly raised eyebrows.īack in March, Netflix’s efforts to stem password sharing became more official, with the company announcing an option for account holders in Chile, Costa Rica, and Peru to create reduced-priced “sub accounts” for up to two people outside their household.įour months later, Netflix took a different tack, rolling out an “add a home” feature that let Netflix subscribers in five Latin American countries “buy” more homes in which they–or others–could use the same Netflix account.Īnd during its third-quarter earnings call in October, Netflix confirmed that it would start charging account sharers starting in “early 2023.” Last year, the streamer began a test asking users to verify their Netflix accounts using a four-digit code sent to the account holder. With all the big players fighting tooth-and-nail over new subscribers, streamers like Netflix aren’t giving password sharers a free pass anymore.Īrguably, Netflix has begun its password-sharing crackdown already. Today, it’s up against the likes of Disney+, HBO Max, Paramount+, Peacock, and Apple TV+.
Back in 2016, Hastings could afford to be cavalier about password sharing because the streamer faced little in the way of serious competition. The streaming landscape has also changed dramatically in the past few years. While Netflix hasn’t quantified how much revenue it may have lost from password sharers, a Los Angeles Times report estimates the practice may have cost streamer and pay-TV operators up to $9.1 billion in 2019, a figure that could balloon to $12.5 billion by 2024.
Password sharing was partly to blame, the company said. By early 2022, that growth had stalled, with Netflix reporting that its subscriber base had shrunk for the first time in a decade. Of course, Hastings’ 2016 comments came in the context of explosive subscriber growth for Netflix. To be clear, Hastings wasn’t actually encouraging password sharing, but he didn’t seem interested in a crackdown, either, noting that account sharing “really hasn’t been a problem.” As recently as 2016, Netflix CEO Reed Hastings called the practice a “positive thing” because so many password sharers eventually got their own accounts. Netflix didn’t always have a problem with subscribers sharing their passwords.
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