After talking about and testing password-sharing fees for months, Netflix is aiming to roll them out in 2023.
Why it matters
It'll cost a lot of Netflix watchers more money: The company estimates more than 100 million households are streaming without paying directly.
Netflix is aiming to roll out a structure to charge accounts for password sharing next year, the company said Tuesday, ratcheting up its efforts to get more than 100 million freeloading households to start paying up as the company contends with sliding membership and intensifying competition.
After years of being relatively laissez faire about password sharing, Netflix said Tuesday that its "goal is to find an easy-to-use paid sharing offering that we believe works for our members and our business that we can roll out in 2023." It has previously said that it will implement password-sharing fees globally, including in the US.
So far, its password-sharing charges have been confined to tests in a handful of Latin America countries, where it is experimenting with two schemes.
In its first test, Netflix charges a fee to create cheaper "sub" accounts that are linked to a main subscription but have their own profile, login and password. People who have Netflix's cheapest plan can't add any of these sub accounts; every other membership can add up to two of these sub accounts. Next, Netflix said it would try a new method starting next month, which will charge to add more "homes" where you can stream Netflix in addition to one primary residence, with a limit on how many additional homes you can add depending on your membership level. The more you already pay for Netflix, the more households you can add.
Whether it's charging for a sub account or for an additional home, the fee is less than the cost of a standalone Netflix subscription.
Netflix's dominance of streaming video -- not to mention its years of unflagging subscriber growth -- pushed nearly all of Hollywood's major media companies to pour billions of dollars into their own streaming operations. These so-called streaming wars brought about a wave of new services, including Apple TV Plus, Disney Plus, HBO Max, Peacock and Paramount Plus, among others -- a flood of streaming options that has complicated how many services you must use (and, often, pay for) to watch your favorite shows and movies online.
Now, feeling the heat of intensifying competition to hold onto your attention and your subscription account, Netflix is pursuing strategies it previously dismissed for years. In addition to the password-sharing fees, Netflix also plans to launch cheaper subscriptions supported by adverting.