Streaming giant, Netflix has announced it will start charging users who share their passwords with others on the platform.
The update was given during Netflix’s quarterly report where it was revealed the decision will take place from early next year, 2023.
This process has already been enabled in five Latin American countries as Netflix had earlier announced it will be testing the features in July
Netflix users in Argentina, El Salvador, Guatemala, Honduras and the Dominican Republic were made to pay an extra fee when using their accounts for more than two weeks outside their primary residence.
The streaming platform lost about 200,000 customers in the first quarter of 2022 and also got a chunk of its subscriber growth sliced off. It blamed account sharing as it noted that more than 100 million households are using accounts paid for by other people.
“Today’s widespread account sharing between households undermines our long-term ability to invest in and improve our service,” Chengyi Long, a director of product innovation, said.
Further forecasts had shown it would lose 2 million more subscribers in the second quarter as its share price dropped more than 65% this year.
In other to mitigate the impending crises, Netflix had decided to monetize account sharing as a means to curb the expected financial issues.
The company, therefore, took some major business decisions to increase income like the payment for password sharing and the ad-supported subscription plan for 12 countries which include Canada, Mexico, Australia, Brazil, France, Germany, Italy, Japan, Korea, the UK, US and Spain.
In its quarterly report, Netflix said “After listening to consumer feedback, we are going to offer the ability for borrowers to transfer their Netflix profile into their own account, and for sharers to manage their devices more easily and to create sub-accounts (“extra member”), if they want to pay for family or friends”
This new feature which is already being tested in Chile, Costa Rica and Peru will enable a profile created on a shared Netflix account to transfer its watch history and movie recommendations to a new, independent account.
It will also be possible to add this new account to another user’s Standard or Premium subscription plan.