You may have forgotten about Netflix's password sharing crackdown. Netflix's attempts to get people to pay more to share their accounts across different locations was the talk of the town this past January and February.
Yes, Netflix decided that the era of "love is sharing a password" was over. That tweet is still up, though. The era of "paid sharing" (more on that below) was to replace it. This change even made it to Canada this past February.
That said, I expected the crackdown to be in the U.S. by now, too. In Netflix's January 19, 2023 quarterly letter to shareholders, the company stated "Later in Q1, we expect to start rolling out paid sharing more broadly."
Q1 ended on April 1st. 13 days later, A Hollywood Reporter story states that Wall Street is eagerly waiting Netflix's Tuesday (April 18) earnings report to learn more about its paid sharing efforts.
I didn't forget about this whole password-sharing crackdown. Having canceled my own Netflix, I had to ponder resubscribing when I wanted to watch BEEF, the first interesting Netflix show in a while. I didn't resubscribe (wink, wink), because I realized I didn't have to (nudge, nudge) yet. Here's why I might need to, soon:
The state of Netflix's password-sharing crackdown
First, the basics. Netflix's account-sharing crackdown is based around the fact that Netflix wants to stop something it sees as mooching. Specifically, Netflix believes that repeated use of the same Netflix account from different homes is stealing. And this all came about after Netflix's subscriber growth stalled last year.
As Netflix expanded this crackdown from Latin America to Canada, New Zealand, Portugal and Spain, it published an update on this topic that sought to try and clear things up. It even said that vacationers won't be impacted, noting "Members can still easily watch Netflix on their personal devices or log into a new TV, like at a hotel or holiday rental."
And, so, I sit here, in the "coming months," wondering how imminent the password-sharing crackdown will be in the U.S..
That post also made pricing official: CAD$7.99 per month per "extra member" in Canada, NZD$7.99 in New Zealand, Euro 3.99 in Portugal and Euro 5.99 in Spain. Standard subscribers (paying $15.49 per month) can buy one extra member, and Premium subscribers ($19.99) can buy two.
In that same update, Netflix had said, it was "ready to roll [different anti-password sharing approaches] out more broadly in the coming months." Then, February finished. March came and went, and April delivered the news that HBO Max was turning into Max. And, so, I sit here, in the "coming months," wondering how imminent the password-sharing crackdown will be in the U.S..
This time it's good that Netflix is publicly beta-testing
Why is Netflix waiting? As someone who tried out Netflix Basic with Ads, I feel confident in saying that Netflix isn't afraid of putting out new features that are more of a public beta test than you'd think.
On day 1 of ad-supported Netflix, ad-insertion was weird, 720p as your only option didn't make sense and ads weren't even in some shows. Some of the best Netflix shows (The Good Place, House of Cards) weren't available for this cheaper tier, either.
As much as this is all going to irritate subscribers and probably get "cancel Netflix" trending again, the password-sharing crackdown seems as inevitable as the Shamrock Shake's annual return at McDonald's.
So I look at Netflix's slow, gradual roll-out of its password sharing crackdown as one would look at a wave that is still building, and far from done. The company is likely learning lessons from its first implementations that it will use for us in the U.S., and our friends across the pond in the U.K..
As much as we wish Netflix would forget about the password-sharing crackdown, this delay is (realistically) a good thing. For every few groups sharing their Netflix in ways that execs don't believe in, there's a family that is forced to split their streaming across multiple locations.
In other words, there will be edge-case situations that Netflix may not have thought of, and will discover along the way. As much as this is all going to irritate subscribers and probably get "cancel Netflix" trending again, the password-sharing crackdown seems as inevitable as the Shamrock Shake's annual return at McDonald's.
Outlook: So, here are your options
In its statements to shareholders, Netflix stated it believes more than 100 million users are violating these rules. This means that Netflix sees a lot of money on the table, and doesn't want to let it go.
So, what's a Netflix user to do? Well, unfortunately, we can't say "just use a VPN," because Netflix is tying usage to specific households, not states. Looking at the above "extra member" pricing, we'd guess U.S. rates may be around $5 more per person.
Netflix may use lower rates to start in the U.S., of course. Either way, you can either pay that extra amount, or do the one thing Netflix really fears. You could cancel Netflix. Sure, it's one of the best streaming services, but how better to vote than with your dollar?
