Netflix is ​​still trying to figure out how to charge for password sharing

There was a time when Netflix had it all when it came to TV and movie streaming market share, but viable deals from companies like Amazon, Disney, Apple and Warner Bros. Discovery forced the service to rethink their business plan. The company continues to experiment with ways to crack down on password sharing in its Latin American market, Bloomberg reports.

Limited use is OK

Netflix will ask users in Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic to pay additional fees if they want to use an account for more than two weeks outside of their primary residence. This is intended to deter long-term password sharing while accounting for things like vacations.

In these areas, you will have a main residence where you can access Netflix on all your devices. If you want to use your Netflix account in a second home, Netflix requires you to pay the equivalent of approximately $1.70 in Argentina and $2.99 ​​in other countries. Depending on your plan, you can add more additional houses; one on the Basic plan, two on the Standard plan, and three on Premium. Bloomberg says it won’t affect smartphone, tablet or laptop users, but the main problem still exists: how does Netflix decide what constitutes a household?

What is a “household?” »

Netflix started testing this in March, focusing on Chile, Peru and Costa Rica. For this test, Netflix allowed users to add “sub-accounts” to an existing account for the equivalent of around $2-3. The Rest of the World (via The Verge) noted in May, however, that subscribers were unsure of Netflix’s definition of a household (while other users found ways to circumvent the prompt entirely). ).

For example, if mobile devices are not affected, does Netflix make this decision based on the device’s direct connection to the carrier, or does this also include the use of WiFi? If someone goes back and forth with their laptop between two houses, is it these two households? If being on a mobile device is an automatic pass, how does Netflix determine that you are on a mobile device?

100 million households use shared passwords

It’s a big deal. Bloomberg notes that more than 100 million households use accounts paid for by other people and cited shared passwords as the reason for its slow growth and first reported loss of customers in nearly a decade. in the first quarter of 2022. The company’s share price has fallen nearly 70% this year. The company says password sharing has been particularly high in Latin America, so testing these initiatives there first.

The company is trying to strike a balance between enticing these password sharers to cough up at least a few dollars without also alienating paying users at the same time. The company also hopes to ease the transition with an account transfer tool that lets you transfer your user profile (recommendations, watch history, and My List) to one of these sub-accounts or to a brand new account.

While some users will certainly adopt this model, others will choose to drop the service rather than pay more. To provide another possible avenue, Netflix explored an ad-supported level of streaming and recently partnered with Microsoft to make these ads happen. As of now, Netflix hasn’t announced any specific plans to expand its password sharing limitations to other territories, but it’s almost a certainty once the streamer fixes the issues.

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