Netflix subscribers are marching off the platform following password sharing ban
A few days ago we told you that Netflix had put the kibosh on password sharing in the U.S. Netflix wants each account to consist of one household and anyone living in another household must either pay for their own account or have another account pay for them. No longer can someone living in a separate household share a Netflix password and get the streaming service for free.
If you want to share Netflix with someone not in your household, the video streamer is giving you two options. Anyone on your account can transfer a profile to a new membership that they pay for. Or, you can share your Netflix account with someone who doesn't live near you for $7.99 per month. Keep in mind that if your Netflix subscription is obtained through one of Netflix's partners (such as a subscription you have through your wireless carrier), you cannot use the latter option.
Twitter subscribers create the #CancelNetflix hashtag
Whether Netflix anticipated what was going to happen, we can't say. But as spotted by BGR, on social media sites like Twitter, the #CancelNetflix hashtag has been seen quite often on numerous tweets. Not that the end to password sharing is the only reason for the surge in cancellations. Other factors mentioned by former subscribers included complaints about the quality of the original content released by Netflix, and complaints about the cancellations of original series that Netflix users were following.
I've been a subscriber for 10 years. I'm now married with kids and have homes in multiple countries. For this reason, I upgraded to Premium. Netflix used to be convenient, even if they were overpriced and had mediocre content. They just lost that edge. #CancelNetflixpic.twitter.com/1PkVlVHieB
— Ben (@bennykins78) May 28, 2023
Netflix most likely realized that it would be getting some cancellations after cracking down on password sharing. It probably figured that whatever business it lost would be made up by those willing to pay for their own account, or from those willing to pay for a Netflix user who they previously shared their password with. But it appears that some long time Netflix subscribers are the ones saying goodbye to the streamer.
Besides "Ben," a 10-year Netflix subscriber whose tweet we embedded in this article and who is leaving the service, another Twitter subscriber (@gfgm223) says that after "11 years paying a subscription, oh well, time to move on." These are the accounts that the video streamer might have figured were so "addicted" to Netflix that they would stay with the platform regardless of how it handled the password sharing issue.
Netflix still expects to report revenue growth after banning password sharing
Earlier this year during an earnings conference call, the company said, "From our experience in Latin America, we expect some cancel reaction in each market when we roll out paid sharing, which impacts near-term member growth. But as borrower households begin to activate their own standalone accounts and extra member accounts are added, we expect to see improved overall revenue, which is our goal with all plan and pricing changes."
So there you have it. Netflix expects that even after the cancellations, it will see revenue grow as those at risk of losing their Netflix connection pay up for it. or extra member accounts are created. The extra member accounts depend on the largesse of the account holder and that might be hard for Netflix to control. But getting those who were riding the back of password sharing to pay for their own accounts will depend on producing compelling content and that is an area where the video streamer might need more work.
As of the first quarter of this year, Netflix had 232.5 million paid subscribers world wide according to Statista. In the U.S., that figure is believed to be 74.4 million paid subscribers. During the first quarter of 2023, Netflix reported revenue of $8.162 billion. Future revenue numbers will tell us whether Netflix made the right decision about password sharing.
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