It has been reported that Netflix is working on new features for its platform. The purpose of this feature is specific - to limit users from sharing account passwords and force non-paying viewers to subscribe. A Netflix spokesperson said: "The purpose of this design is to ensure that users are authorized to use their Netflix accounts."
Here's what Wall Street has to say about how many people will become paid users. Analysts believe that Netflix may face problems with this new rule. The level of uncertainty is very high and Netflix's competitors are watching and competing for users.
Of course, we don't expect Netflix's growth rate to continue post-pandemic. As more people get vaccinated, they will resume normal activities, and blocking password sharing will hurt Netflix's bargaining power.
How many people share accounts with strangers (people outside the family)? What is the ratio? These questions deserve attention. Analyst Bloomberg estimates that there are 74 million Netflix users in the US, of which about 29-30% share accounts, while Magid estimates that this share is about a third.
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Sharing passwords on Netflix is quite common
Netflix's terms of service do prohibit users from sharing passwords with people outside the home, but many people still do. Back in 2020, Netflix CEO Greg Peters told The Wall Street Journal that Netflix would control password sharing.
The streaming service provider also has limits on the number of devices that can stream content simultaneously. The $8,99 base package limits playback to one device, while the $13,99 package allows playback on two devices. The $17,99 package lets you play on up to four devices.
There are always terms and conditions for streaming platforms regarding multiple profiles. These terms tend to limit the profile to people in the same household. Services like Netflix, HBO Go, Amazon Prime, and Disney+ have such services.
Back in 2016, Hastings said: “Password sharing is something you have to learn to live with because there's so much legitimate password sharing, like you share with your spouse, with your kids, so there's no bright line, and in we are fine as is."
However, as of 2019, the company was already considering password sharing. At that time, there were no big plans to announce something new. The streaming service provider now has over 200 million subscribers worldwide. In 2020 alone, it received about 27 million new subscribers.
