Netflix is rolling out paid password sharing in Canada, New Zealand, Portugal and Spain as the company looks to reap revenue from a practice that encouraged subscribers to engage at no cost.
A blog post confirmed the rollout and said it would expand in the coming months. The announcement follows some online unrest earlier in the week when a company web page regarding testing of password plans in Chile, Costa Rica and Peru went live in other countries. (A trial of the new setup went live in those countries last year.) The bulletin has circulated online, sparking concern over its apparent requirement for users to specify a “primary location” for a given household’s account. Backlash centers around the idea of regularly checking WiFi information.
“We know there’s a lot of confusion about Netflix sharing,” the company acknowledged in a tweet. “A Netflix account is intended for a family,” it continued, adding that the goal is to “give you more control over your account.”
With its recent decline in advertising, Netflix has identified password sharing as a significant revenue opportunity as its core business matures and faces increased competition and economic headwinds. Many Wall Street analysts have suggested it could bring in billions in additional revenue, but the process of communicating changes around password sharing is delicate, even senior executives readily admit.
At the heart of the streaming giant’s pitch to consumers is its belief that sharing nearly 100 million accounts is hurting its ability to invest in original movies and series.
The blog post notes that consumers can already take several steps to ensure that multiple people are using a single account in a legitimate fashion. They “buy additional members” (this is where the revenue opportunity comes in), priced to do so in new territories at CAD$7.99 per month in Canada; NZD$7.99 in New Zealand; Euro 3.99 in Portugal; and Euro 5.99 in Spain.