For a long time, Netflx had a laissez-faire attitude toward password sharing, as did most of the other streaming services. They never officially endorsed it, but they didn’t really do much to put a crackdown on it, either.
But Netflix (NFLX) realized that letting people share passwords was a good way to get them used to streaming, with the idea that once they graduated college and got jobs, they’d get their own account.
Other streaming platforms, like Disney+, have had the same issues of password sharing — a recent report found that Disney+ has five moochers for every one actual subscriber.
But stopping that sharing has been difficult. Plus, in a social media age where brands want to be seen as hip and relatable, cracking down on passwords does run the risk of seeming miserly and prompting a backlash.
Netflix recently announced plans to roll out a feature in Chile, Costa Rica and Peru that will charge users a little bit extra for sharing their accounts (i.e., letting people use their passwords) with up to two people outside their household.
Twitter users have begun expressing their displeasure at the move, and Tweet from a few years ago has gone viral.
But on the whole, this effort to curb sharing isn’t all that aggressive.
If a device outside a subscriber’s household logs into Netflix, they may be asked to verify the log-in by entering a verification code sent to whoever is paying for the service. So essentially, think of it as gentle nag.
What Will Aggressive Look Like?
A new study from Beyond Identity, a password-less identity platform for workforces and customers, has shed some light on how widespread password sharing is, and how much streaming services are losing from the practice.
But if the service wanted to get more aggressive, what steps could it take? It turns out, there are some options that haven’t been deployed yet.
“From what’s been mentioned by Netflix specifically, it seems that these streaming services can start to take action by charging more for accounts that are shared outside of a single household,” says Jing Gu, product marketing lead for secure customers, at Beyond Identity.
“These streaming platforms likely have ways to tell when an account is being shared like this, via IP address locations and number of devices simultaneously accessing the service, so they can limit the number of actively streaming devices and start flagging the accounts that are suspected of being shared,” Gu said.
But how successful will this plan be, really?
From Gu’s research, it seems that “surprisingly, only 17% of moochers said they would pay for their own account if the provider said they could no longer share,” and that 27% said they would not pay for their own account, while 45% said they might.
Here's Why It's Hard To Get People To Stop Mooching And Start Paying
The problem here is that everything is more expensive these days, and the average consumer likely might think these companies have enough money.
“Many people feel that these big companies don’t really feel the impact of that because the perception is that these platforms are doing well in terms of revenue. This consumer sentiment is likely to become a challenge as the companies face more revenue loss from account sharing,” observes Gu.
“Ultimately, it’s the platform’s responsibility to communicate how its subscribers contribute to the overall quality of the platform,” he says.
He said he thinks that the best way for streamers to change people’s minds is to give them what they want.
“It’s possible that if these large streaming companies place a greater emphasis on support for content diversification, through indie films or underrepresented talent, it could help their case in driving subscriptions,” he said.
