Netflix is ready to stop being nice about those breaking its rules. Yes, the Netflix password sharing crackdown is finally expanding from its limited testing — and about to come to many more TVs around the world.
So, if you've been sharing a Netflix password and login across multiple addresses, expect Netflix to try and stop you. Or at least ask for more money to keep doing this.
Why is this happening? Well, while the economy isn't great at the moment, and everyone finds ways to stretch a dollar (or their account) it's arguably a beast of Netflix's own making. Infamously, Netflix Twitter account posted the message “Love is sharing a password,” (opens in new tab) in 2017.
And now, Netflix says enough is enough. While Netflix (opens in new tab) says "It’s great that our members love Netflix movies and TV shows so much they want to share them more broadly," the service's execs are tired of it hurting their bottom line. The same post declares that "today’s widespread account sharing between households undermines our long term ability to invest in and improve our service."
And their plan to stay high among the best streaming services is to get people to spend more if they want to share their accounts. This is a bet on the quality of the the best Netflix shows and best Netflix movies, and one that shows Netflix believes it's in a position of power.
Netflix password sharing crackdown: When is it happening?
Netflix, for many months now, has been encouraging users to "add an extra member" or "add a home" when it thinks people are breaking the rules on sharing an account and password outside of the limitations. More on that below. In recent testing Netflix has done in Chile, Costa Rica and Peru, it's charging users around $3 USD per user or home.
Then, on October 18, 2022, in Netflix's Q3 2022 quarterly earnings report (opens in new tab), it announced its next step in its plans to "monetize account sharing," — which is its way of saying make more money off of freeloaders.
Netflix said that these tests would be expanding "more broadly," which most interpret as a global rollout, "starting in early 2023." The report verified the above testing seems to have worked, as the "the ability to create sub-accounts ('extra member'), if they want to pay for family or friends." is a part of this.
The report also noted that this change will include the ability for users to turn their Netflix profile into their own account, if they don't want to be a sub-account/extra member.
Netflix password sharing crackdown: How will this work?
Netflix (opens in new tab) identifies rule-breakers by using "information such as IP addresses, device IDs, and account activity." Sometimes, Netflix uses a device verification code to confirm your identity, it will require devices in the previous household to re-verify before they can stream again.
In order for Netflix to actually make this work, they're probably going to be cutting people off if someone else from a different location logs on. We doubt that simply saying "stop sharing your account, and please give us money."
One big potential flaw here pertains to when you go on vacations. Netfilx's own site notes that "Travel [is] included" and that "You can watch while outside the home on your tablet, laptop or mobile." We guess Netflix's tech can tell the difference between streaming for a week while you're away from home and a long-term usage at a second residence.
As for setting up extra users? When Netflix started testing this in Argentina, Dominican Republic, El Salvador and Honduras, it granted users the ability to manage the homes on their account.
It doesn't look like you'll be able to set a default home, or your main home. But then you'll be able to "buy additional homes" — and remove homes from access to your account (say, if your ex still has your password — which you should just change).
Members on the Basic plan were able to add one "extra home," and those on the 1080p Standard plan could add two. The 4K UHD Premium subscribers could add up to three extra homes.
Netflix password sharing crackdown: How much will it cost?
If the tests in Latin America countries are also copied on pricing, expect the U.S. "extra homes" to cost around $3/£3/$4 CA/$5 AUD a piece.
We would not be surprised to see Netflix test varying pricing around the world.
Netflix password sharing crackdown: How you're breaking the rules
The Netflix Help Center (opens in new tab) states "A Netflix account is for people who live together in a single household. This single household is the Netflix household and is associated with the primary account owner’s devices and the devices used by other people who live in the Netflix household."
And Netflix reps told Rest of World (opens in new tab) that it's always defined a household as people living in the same building. So, if your family is spread across multiple locations, Netflix sees that as multiple households.
Outlook: How forceful will Netflix password sharing crackdown be?
The efficacy of Netflix's password sharing crackdown will likely be defined by how hard they push users to add accounts or spin-out their existing accounts. If a Netflix account can't be used from two different locations at the same time, then people will probably have to pay up.
If the fee is small enough, it doesn't seem unlikely that they'll actually pay. People want to watch what Netflix offers, at least until they want to cancel Netflix. And if Netflix is too forceful, they may start actually encouraging the latter.