Netflix has announced that it will implement its password-sharing crackdown by the end of Q2 2023, which represents a delay from its earlier statement that it would end password-sharing by the end of Q1. The company confirmed this news during the release of its Q1 2023 financial results, stating that it would put an end to password sharing in the U.S. and other countries. The crackdown was first announced by Netflix in response to falling subscriber numbers and growing competition from companies such as Disney.
Netflix customers have not been quiet about their displeasure with the upcoming changes, with many taking to the internet to express their frustration and even threatening to cancel their subscriptions. This has been particularly concerning for households with college students who may not be able to check in at home frequently enough to meet the new sharing requirements.
Previously, Netflix had established guidelines allowing for password sharing within families where children are living away from home. The company planned to enforce these guidelines by requiring devices to check in about once a month, but some users have expressed concerns about how difficult it will be to meet this requirement in practice.
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The company stated in a shareholder letter that it has learned from previous launches about the best way to implement these changes and what is most important to its members. These include the ability to watch content while travelling and to better control access to their accounts, as well as the option to transfer profiles to separate accounts. As a result, Netflix has delayed the rollout of the changes until Q2 to implement these improvements.
The password-sharing crackdown was initially launched in Latin America in 2022 and later expanded to Canada, New Zealand, Portugal, and Spain. Netflix has stated that people in other regions, including the US and UK, can expect the changes to take effect before July.
Despite the delay, the crackdown is still coming. Netflix has expressed its desire to monetize the 100 million users who share passwords to invest in new shows. Additionally, the company wants to offer more sophisticated pricing options to consumers that suit their individual needs.
It now offers pricing tiers for HD for example, and an ad-supported option is gaining traction, Netflix claims. “Engagement on our ads tier is above our initial expectations and, as expected, we’ve seen very little switching from our standard and premium plans.”
Netflix is also about to upgrade the feature set of its ads plan to include 1080p versus 720p video quality in 12 ads markets, starting with Canada and Spain.
Perhaps the end of password sharing will see more Netflix users leave, but the firm believes this will benefit revenues in the long run. Describing the delay from the first to the second quarter, Netflix said: “While this means that some of the expected membership growth and revenue benefit will fall in Q3 rather than Q2, we believe this will result in a better outcome for both our members and our business.”
Sorry folks, it looks like Netflix is still pressing ahead with its password-sharing crackdown. Stay tuned and I’ll keep you updated.
The Toronto House Canada.
