Netflix’s Password-Sharing Crackdown Pays Off
A study by Leichtman Research Group revealed that Netflix’s strategy to restrict the sharing of passwords and accounts is turning beneficial for the company. Netflix started implementing password restriction measures last year.
Before the crackdown, it was estimated that in 2022, approximately 100 million users were accessing Netflix through shared accounts.
Netflix employs various measures to detect unauthorized sharing of passwords and introduced a household feature that allows only the members of the particular household to access Netflix accounts. Also, the users were allowed to migrate their profiles to their new subscription account, including their watch history and preferences.
Additionally, Netflix also provided options to add “extra user” at a reduced fee of $7.99 monthly, offering savings compared to the standard rate.
Leichtman Research Group’s survey included 2,546 households, indicating that password sharing in the US has decreased to approximately 10% of Netflix users. This marks a decline from 16% in 2018, 14% in 2021, and 15% in 2022.
This significant reduction in account sharing is noteworthy, although it’s based on self-reported data from the users themselves.
Sharing passwords has been a significant hurdle for streaming services, often regarded as an open secret within the industry. While it may have contributed to the growth of streaming platforms in terms of user base, it did not necessarily translate to increased revenue.
The LRG study also found that about 10% of Netflix users still borrow accounts from other users, a slight decrease from 12% in 2022.
The data also suggests a higher inclination among young audiences to share their accounts more. An estimated 17% of users aged between 18 to 35 use a subscription service paid by someone else, in contrast to 7% among those aged above 35
This trend highlights a generational difference in the sharing of streaming services, with younger audiences showing a greater tendency to use accounts used by others.
The continued success of Netflix has inspired its competitors, too and streaming platforms like Disney+ and Warner Bros. Discovery’s Max has also announced measures to implement account-sharing restrictions.
Ragul Thangavel
With over nine years of diverse professional experience, Ragul has made significant contributions across various domains, including Media Operations, OTT Technologies, Video Production, Ecommerce, and Social Media.
Holding an Engineering degree, Ragul's career took an unconventional turn when he discovered his passion for writing, leading him to begin his journey as a content writer.
His career has been exclusively dedicated to the growth and development of startups, where he has played a pivotal role. His unique blend of technical knowledge and creative prowess has enabled him to drive innovation and success in every venture he has been a part of.
