(NEXSTAR) – Netflix has been warning for months that it would start cracking down on password sharing in the US after introducing changes in several countries, including Canada. Company executives gave another indication of how soon Netflix will be tackling password sharing in the US, albeit later than expected.
Netflix has been exploring ways to crack down on password sharing, including a login verification process in 2021 and using sub-accounts for people living outside the account holder’s home in 2022, which has been tested in Chile, Costa Rica and Peru. In early February, Netflix expanded its paid account sharing to Canada, New Zealand, Portugal, and Spain.
A version of paid password sharing was expected to come to the US by the end of Q1 — a date that has since passed.
During a first-quarter earnings conference call on Tuesday, Gregory Peters, co-CEO and director of Netflix, said that recent rollouts for paid account sharing “have been going well” and that the company “is coming out of this latest set of launches about learned some improvements we could make. ”
He went on to acknowledge the delay in the US rollout – “it was better to take a little more time -” and said a “new improved version” of paid password sharing will be widely rolled out in the second quarter.
That means by the end of June, sharing a Netflix account will be more complicated than just sharing a login with someone.
It’s not yet clear exactly how paid password sharing will work in the US
In other countries, Netflix has introduced the aforementioned sub-accounts, which allow account holders on a Standard or Premium plan to add up to two people who live outside of their household to their plan for an additional, smaller fee. Netflix hasn’t said what that fee might be in the US
When it introduced sub-accounts in Chile last year, Netflix charged $2.99 for the additional member. In Canada, Netflix charges CAD$7.99, which is about $5.95.
Netflix also knows that given the move, users may be moving to paid sharing. In a letter to shareholders, executives noted that while some in Latin America have terminated their accounts during the crackdown on password sharing, new member registrations have increased with the use of sub-accounts and new users.
Peters said Tuesday that while the company knows that some US users “won’t convert” when paid sharing begins, those users “essentially represent a pool of people that we can then pursue as we improve our offering.” “ with films, series and games.
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“It’s worth noting that this will not be a move that everyone loves, so there will be some current members who are unhappy with this move. We’re going to see some sort of exit reaction to that,” Peters said on a conference call with investors in January. “We think this is similar to what we see when we raise prices.”
Since introducing changes in Canada and three other countries, Netflix hasn’t said what action it will take if subscribers continue to share accounts outside of their homes.
Also on Tuesday, Netflix announced it would no longer ship DVDs in the mail, ending the service after 25 years.
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