Netflix Inc.’s expanded password-sharing crackdown seems to be having the desired effect — and it’s rolling out more smoothly than it did in test markets.
The streaming-media company is in the midst of trying to maximize revenue opportunities by clamping down on people who borrow Netflix NFLX credentials instead of paying for their own memberships. After testing the initiative in several markets, Netflix launched its crackdown in a larger set of countries, and despite some complaints, users seem to be sticking with the service.... Netflix Inc.
The streaming-media company is in the midst of trying to maximize revenue opportunities by clamping down on people who borrow Netflix NFLX credentials instead of paying for their own memberships. After testing the initiative in several markets, Netflix launched its crackdown in a larger set of countries, and despite some complaints, users seem to be sticking with the service.Fewer Netflix subscribers in the U.S. and U.K.
Another interesting trend is that new plan sign-ups have increased in the U.S. as a result of the clampdown on account sharing. Netflix is giving accountholders the option to pay to add additional users to their existing plans, but it appears that more U.S. users instead are opting to set up new accounts of their own, at least compared with Canadian users, who “may be the most generous with their plans” in terms of adding other paid users.
Jefferies analyst Andrew Uerkwitz is upbeat about Netflix’s positioning as it takes this tougher tack on account sharing, especially as streaming rivals Walt Disney Co. DIS and Warner Bros. Discovery Inc. WBD move to strip some content off their own platforms in a bid to cut costs and shake up elements of their branding. At the same time, he notes that Netflix’s initiative is still in its early days.