When Will Netflix Stop Password Sharing?

There’s a truism in business that it’s harder and more expensive to earn a new customer than to keep an old one, so streaming giant Netflix has announced an end to “password sharing” as a way to squeeze more revenue from people already using their service. The company is hoping that by limiting the ways people can share their account password, they will force users who aren’t currently paying for the service (but who are using it thanks to a friend or family member) to sign up. It isn’t a popular program with customers, but we won’t know until it has been implemented whether or not it was a good idea. 

So when is that? Well, there is not yet a precise date, but the short answer is, sometime in the next month. 

It might feel like short notice, but the streaming giant has been saying publicly for years that they interpreted password sharing as a major problem, and in 2022 they started saying that they intended to take action to limit it. This is one of those situations where  a lot of people did not take the “warnings” seriously, and so now they’re shocked that the change is coming so soon.

As the policy has been described, the primary location for a Netflix account will be a home base of sorts, and that home network will become the only place you can use your account without jumping through some hoops. If one of your authorized devices does not connect to the home network at least once every 31 days, the device will be blocked. If users try to log-in from another network, Netflix will block access and prompt users to sign up for their own account.

The problem Netflix is facing is an industry that demands constant growth. At this point, they have so many subscribers that significant growth is becoming more difficult than ever. They reckon that there are around 100 million people who are hitchhiking on someone else’s account, legitimately or not, and that by forcing those people to open their own account, they can increase revenue. Some existing customers may be upset, and a few might even leave, but traditionally people threaten to leave Netflix a lot more regularly than they actually leave Netflix.

Last year, Netflix took a different approach to password sharing in some international markets, charging a $3 fee to users who allowed others to use their account. That change proved unpopular, so Netflix devised a different approach before introducing restrictions to North America, which is their biggest market.