How Password Sharing Test from Netflix is Affecting its Subscribers List


Netflix is the largest content streaming service, with 221 million subscribers worldwide.  The streaming service has seen great success and a high subscriber base thanks to quality shows and films.

Some of the best shows that propelled Netflix to the top include the phenomenal Stranger Things, Squid Game, The Witcher, and Bridgerton. Top films on Netflix include 6 Underground, Extraction, Red Notice, Don’t Look Up, and Bird Box.

However, the streaming giant is facing its toughest fight to keep its place at the top, with users choosing to cancel Netflix subscription. The password-sharing test from Netflix has negatively affected its user base, with many choosing to leave the platform due to price hikes.

This guide breaks down the password sharing test from Netflix and how it has affected its subscriber base.

The Netflix Password Sharing Test

The Netflix password sharing test was an experiment rolled out by the streaming service in certain countries in South America. This test aimed to crack down on users sharing their accounts with others outside their households. Netflix increased the subscription fee for users sharing accounts.

Netflix users in Peru, Chile, and Costa Rica were given the option to ‘Add an Extra Member’ to add sub accounts for extra users at a low monthly cost. t.

This strategy is used by other streaming services like Spotify, which has a family plan with a set number of sub-users. In this plan, each user has credentials, eliminating the need to share passwords.

The number of people you share your account with should be close to the number of people the streaming service knows are on your account. Instead of kicking out freeloaders from your account if it detects password sharing, Netflix will make the account holder pay extra.

How the Netflix Password Sharing Test Works

Netflix will offer an easy and secure way to share an account with multiple users, but at an additional cost.

The Netflix account holder will have an option to add more users with the newly introduced ‘Add an Extra Member’ feature. This feature allows the holder to add two users who don’t live in the same household at an extra $2.99/month.

Also, Netflix tested the ’Add Extra Home’ option in the Dominican Republic, Argentina, Honduras, El Salvador, and Guatemala. This anti-account-sharing feature requires users to pay an additional fee to use the accounts outside the primary household.

The streaming service creates a designated ‘home’ it identifies as the main household linked to an account. Users can access the Netflix account across all devices at home without going against the policies.

In addition, users can continue accessing the account away from the designated home for two weeks. However, the user must add extra homes to continue using the Netflix account, which also comes at an additional fee.

The Basic Netflix plan supports one extra home, the Standard plan supports two additional homes, while the Premium plan allows three extra homes. The ‘Add an Extra Member’ and ‘Add Extra Home’ features will cost $2.99/month in all countries where Netflix is available. Argentina is the only exception where users will only pay an additional $1.17/month.

The Implications of the Password Sharing Test

Netflix warned shareholders that the service would lose close to two million subscribers by July 2022. The password sharing test is fueling the fire because Netflix is already one of the most expensive streaming services. Unsurprisingly, most people opt to share Netflix passwords instead of paying a monthly subscription.

For example, after the recent price hikes, Netflix Basic costs $9.99, Standard is$15.49, and Premium costs $19.99 per month. Compare this to Prime Video membership for $8.99 per month and Disney+ for $7.99 per month.

Asking subscribers to pay more for sharing passwords is a reasonable approach by the streaming service. According to Netflix, around 100 million users shared login details with another account. 

Netflix spends a lot of money acquiring licenses for shows and movies and creating original content.

For example, The Witcher, one of the most highly rated shows on Netflix, costs $10 million per episode. The most successful Netflix original, Stranger Things, costs a whopping $30 million per episode. So, it’s understandable why Netflix wants to capitalize on the password sharing trend by introducing these control measures.

However, this move didn’t go down well with long-term Netflix subscribers who already know they’re paying a premium.

A report by The Information shows that users who’ve been on the platform for over three years account for 13% of Netflix cancellations. This data was released during the password sharing test rollout. Netflix lost over 200,000 subscribers in the first three months of 2022.

It’s reached a point where subscribers spend a lot per month on streaming services. Password sharing has made it easier for binge-watchers to subscribe to different streaming services and share accounts.

However, the password sharing features from Netflix might force users to think about how much they need a particular streaming platform.

How Does Netflix Detect Homes

Most people don’t know that sharing Netflix accounts is against the streaming service’s terms and conditions. That’s why Netflix has introduced the new account sharing measures because it has a home detecting system. 

Netflix uses information such as your device IDs, IP addresses, and account activity to know your location and the number of devices accessing a single account. The streaming service sends a message that too many homes are using your account when it detects different device IDs and IP addresses using one account.

Wrapping Up

Even after losing subscribers due to the recent price hikes and new measures to curb password sharing, Netflix is still the largest streaming service. When the policy is fully rolled out, you’ll spend a little extra to share a Netflix account with someone who doesn’t live in your home.

Some people aren’t comfortable with the new measures to prevent password sharing, but it’s understandable why Netflix is doing it. Netflix also plans to introduce a lower-priced, ads-supported plan to entice people to stop sharing passwords.

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