The streaming service Netflix is ​​planning to restrict account sharing, which is currently free. This means that in the future the use of one's own account outside of the household will only be permitted for an additional charge. This rule has been common practice in Latin America for months. Now the tactic will be implemented “broader,” according to the company in its current quarterly report.

Deadline at the end of 2022 already missed

It was initially announced that the feature of sharing accounts across different households be prevented by the end of 2022 . However, the streaming provider was unable to meet this self-imposed deadline.

The new deadline extends to the end of the first quarter of 2023, i.e. the end of March.

There are currently around 100 million blind Netflix passengers

Netflix had 231 million paying users at the end of 2022. According to the market research company Magid , a third of all subscribers also share the account outside of their own four walls. For Netflix, a household is a shared place of residence - anyone who doesn't live together is officially not allowed to share their account.

Due to the high proportion of people who use the streaming service but never pay for it, the company estimates there are around 100 million blind users. These prevent the company from investing in and improving the streaming service.

“The prevalence of account sharing undermines our ability to invest and improve Netflix in the long term,” the streaming service wrote in its statement. They know that the end of subscription sharing is a big change for many users, which is why several convenience functions have been developed. By this, Netflix means, for example, the ability to extract account data and better manage logged-in devices .

Netflix expects “Cancel Reaction”

Nevertheless, Netflix also mentions possible concerns in the statement that the crackdown on shared accounts could lead to a wave of cancellations by customers. A “cancel reaction” also occurred when the accounts in Latin America were converted.

On the other hand, it has already been observed in Latin America that former co-users are also taking out their own subscriptions. This means that there is still hope for an increase in sales in the long term, which is why Netflix investors should not be alarmed by initial negative news, the company argues.

Sharing remains possible, but is subject to an additional charge

You are forced to take out your own subscription, but it is not absolutely necessary. Netflix is ​​planning to introduce “paid sharing” in this country. This means that account holders pay an additional amount per month, but can use it to share their account with people who do not live in the same household.

The streaming provider has also already introduced this “paid sharing” in Latin America. Converted, the costs for sharing the account are a few euros per person per month - so it remains the cheaper option compared to 2 separate subscriptions.

Netflix also emphasizes that you can easily stream on both your cell phone and TV while traveling.

Locate devices

In order to be able to enforce the new regulation, Netflix must determine where and on which devices it is streaming. To make this possible, in the future Netflix will probably only be able to be used on TV sets that are in your own home. It is not yet known exactly what this will look like when traveling, but there should be a certain amount of leeway.

What was tested in this regard was that you can watch the streaming service on a TV once a year and at a location outside of your own home for two weeks.

During the account transition, some type of account migration service will be available to make the transition easier. A Netflix profile can then be transferred to a new account.

Hastings steps down as CEO

In addition to the announcement of the new regulation, Netflix also announced that Reed Hastings will be stepping down from his position as co-CEO. The now 62-year-old was responsible for managing the company for 25 years. However, he will remain active on the board.

As a successor, the company is again planning dual leadership with Ted Sarandos, who was promoted to co-CEO in 2020, and the previous COO Greg Peters, now also as CEO.

Sources:

Heise , T3N

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