Netflix's Crackdown on Password Sharing and New Pricing Models - Discover Answer
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Netflix’s Crackdown on Password Sharing and New Pricing Models

Netflix Password Sharing Crackdown

Netflix recently took action against password sharing, which seems to be paying off as U.S. subscriber numbers have soared. Data from streaming analytics firm Antenna showed an increase in new subscriptions between May 25 and May 28, with the service adding more subscriptions during this period than any other four-day period since Antenna began keeping records in 2019.

Increase in Average Daily Signups

The crackdown on password sharing led to a significant spike in average daily signups. According to Antenna, the average daily signups reached 73,000 during the aforementioned four-day period, a 102% jump compared to the previous 60-day average.

Record Number of Daily Signups

During the peak of the crackdown, May 26 and May 27 saw nearly 100,000 new daily signups for the streaming service. This record-breaking number of signups highlights the effectiveness of the crackdown on password sharing.

Subscription Cancellations

While the crackdown on password sharing led to a surge in new subscriptions, it also resulted in an increase in subscription cancellations during the May period. However, the impact on Netflix’s overall subscriber growth was still positive.

Signups to Cancels Ratio Up 25.6% Since May 23

Research by Antenna revealed that the ratio of signups to cancellations improved by 25.6% compared to the prior 60 days, indicating that the influx of new subscribers outweighed the increase in cancellations. This demonstrates the overall effectiveness of the password sharing crackdown in driving subscription growth for Netflix.

New Policy: No Sharing Outside Primary Location

As part of the crackdown on password sharing, Netflix has implemented a new policy that focuses on sharing limitations and primary location establishment for subscribers.

Require Establishing a Primary Location

Netflix now requires subscribers to establish a primary location for their account, emphasizing that the streaming service is intended for use only by members within the same household.

Pay an Additional $7.99 per Month to Allow Extra Member (Outside Primary Location)

If subscribers wish to share their account with a non-household member outside of their primary location, they now have to pay an additional $7.99 monthly fee. This extra charge aims to curb unauthorized sharing and generate additional revenue for the company.

Profile Transfer Process for Former Free Users

Former free users who have been sharing an account outside of the primary location can now transfer their profiles and viewing history to a new account. This allows them to maintain their personalized recommendations while subscribing to Netflix individually as paying users.

Netflix Pricing

Netflix offers various subscription plans to cater to the needs and preferences of its users. These plans differ in terms of advertisement inclusion, streaming quality, and the number of devices supported for simultaneous streaming.

Plan with Ads: $6.99 per Month

Netflix’s most affordable plan, priced at $6.99 per month, includes advertisements. This plan provides basic access to the streaming service.

Basic Plan: $9.99 per Month

The Basic plan costs $9.99 per month and offers an ad-free experience. Subscribers are allowed to access content on one device at a time, with a streaming quality of 720p HD.

Standard Plan: $15.49 per Month

The Standard plan is priced at $15.49 per month, offering 1080p streaming quality and simultaneous access on two devices. This plan provides a balance between streaming quality and affordability.

4K Plan: $19.99 per Month

For users seeking the highest quality streaming experience, the 4K plan is available at $19.99 per month. This plan supports watching content on four devices at a time and offers 4K streaming quality. While the Standard and Premium plans allow for viewing on multiple devices simultaneously, Netflix’s new policy requires all devices to be within the primary home location.