Netflix seems determined to curb account sharing, a very popular practice that is causing it to lose a lot of money, and this within two months! A free formula with advertising is also under study.
The end of free account sharing finally has an official date, and it will be for the end of the first quarter of 2023 – in two months therefore –, as the streaming giant announced in a letter to shareholders January 19. “We plan to roll out paid sharing on a larger scale during the first quarter of 2023“, writes the company. “While our terms restrict Netflix usage to a single household, we recognize this is a change for members who share their account more broadly”, she continues, without however indicating the price list. The platform is also considering launching a formula “free television with advertising” (FAST), that is to say a formula entirely financed by advertising – as a reminder, the Essential offer with advertising currently costs 5.99 euros per month.
For several months now, the streaming platform has shown its desire to no longer allow users to share their account with people outside their home. “People who don’t live in your household will need to use their own account to watch Netflix. Netflix is easy to subscribe to and there are plenty of offers. As always, the subscriber can switch offers or cancel their subscription at any time”stipulate the help pages of the company. And this measure should come into effect from the beginning of 2023 in the United States, according to the wall street journal. According to the platform, 100 million people would take advantage of it without paying, thanks to the password of a relative. The situation is no longer tenable for her, because “the widespread sharing of accounts between households taking place today compromises our long-term ability to invest in and improve our service”.
Netflix account sharing: an option at 3 or 4 euros per month
According to The Wall Street Journal, Netflix initially considered adding paid content to its catalog – much like Amazon Prime Video – hoping that the fear of seeing their bills climb would encourage users not to share their words of pass. However, she discarded this idea to keep a simpler interface. To Instead, she thinks she’s relying on the IP address of the internet connection used to log into the account, the unique device identifier, and account activity to track account sharing and charge for it. additional user. A measure already tested in Latin America which, if it does not appeal, still forces many users to choose to pay for sharing, according to internal sources relayed by the Wall Street Journal.
No official price has yet been established, but the specialists evoke a price corresponding to 3 or 4 euros per month for the sharing option. Cowen Inc. analysts estimate Netflix’s effort could generate $721 million in additional revenue next year in the United States and Canada, where there are around 30 million sharers, but some analysts believe that the company underestimates the impact and “collateral damage” that this policy change could cause, as some customers may prefer to simply cancel their Netflix subscription.
Netflix: a model that is starting to run out of steam
To be more attractive, Netflix has set up a subscription with advertisements. Called Netflix Essential with advertising, the formula costs 5.99 euros per month, or 30% less than the entry-level Essential offer. Thanks to it, the SVOD hoped to attract new users who would not have yet crossed the threshold because of the price. Problem: the low cost offer would not have had the expected success. The research firm Antenna explains that it would have represented only 9% of registrations during the month of November in the United States, including half of people already subscribed who would have decided to go down in price range… Netflix disputed these figures by speaking of “inaccuracies” and said he was satisfied with the first results. Still, this will not be enough to go up the slope.
At the time of the announcement of its results, published on October 18, the company indicated that it would begin to “monetize account sharing” via a sub-account system. If the streaming pioneer has long been the benchmark in this field, it was losing momentum and subscribers worldwide – 1.2 million customers left in the first half of 2022. The crisis, however, seems to be behind the famous service. American, since it announced that it had gained 2.4 million subscribers during the third quarter, well above its previous record of 221.8 million set at the end of 2021 – after two very lucrative pandemic years for SVOD. And in terms of time spent in front of television, Netflix is, in the United States, at the same level as YouTube (7.6%), far ahead of Amazon Video (2.9%) and Disney + (1.9%). Reassured by these results, he intends “continue this momentum” notably relying on a new, cheaper, ad-supported formula that is expected to earn it an additional 4.5 million subscriptions in the fourth quarter, for a total of more than 227.5 million subscribers by the end of the year according to forecasts.
Netflix: towards a paid account sharing system
To achieve its goals, Netflix must overcome other challenges. In addition to the fierce competition between the platforms of the giants today – Amazon Prime Video, Disney+, Apple TV+, not to mention the new ones that land, such as Paramount+ or Universal+ –, the firm must face an endemic problem, which still believes with inflation: account sharing. A practice which streaming enthusiasts are very fond of and which saves on the price of subscriptions, especially with the proliferation of SVOD and significant price increases – especially since Netflix is by far the most expensive! It can be whole families who share their account between their members – including those who do not live under the same roof – or friends who pool services – each paying a subscription to a different platform.
To counter this practice, Netflix had tested paid account sharing in March in a few countries – with 2.99 dollars per month billed per additional member – then the possibility of adding households to its subscription – which is linked to a main household. – for a fee. When announcing its financial results, the streaming giant explained that it wanted to “facilitate” account sharing between family members who do not live under the same roof and between friends by creating “sub-accounts (“additional members”), if they want to pay for their family or friends.” Pricing for this new strategy has not been specified. We can nevertheless expect a supplement of 3 to 4 euros per additional user in France, in order to have a price close to that of the lowest offer. In test countries, the primary account owner had to provide a verification code to anyone outside the household who wanted access to the account, with Netflix periodically requesting the code until a monthly payment was made to add subscribers outside the account. foyer.
However, the company faces several difficulties with this method. First of all, it must be determined whether the holder of a travel account is accessing the service from another place, such as a second home or a hotel, or whether another person is borrowing his password. Ditto for separated families, when the child divides his time between the homes of his two parents. One approach the company is considering is allowing subscribers to let Netflix know that they’re changing their location for a certain period of time. In the meantime, it has already implemented a new function clearly intended to stem sharing: profile transfer to a new account!
Netflix profile transfer: an option to encourage account creation
As advertised in a statement, one of Netflix’s latest discoveries, allows you to transfer the content of a profile to a new account, when taking out a new subscription, and thus not to lose your recommendations, your viewing list, your history, your settings. and game saves. This is only a copy, so the profile will not be deleted from the original account upon transfer. This option can be practical for many scenarios: a member who leaves the family home, a breakup, a move, a joint account that is going to be closed… But it is also and above all a way to encourage, casually , fans of account sharing to take out their own subscription.
The feature is rolling out globally, and users will be emailed when it becomes available. To transfer a profile, you must log in to the account, then go to the profile concerned. On the menu at the top right – the icon of the profile in question – you have to click on “Transfer a profile” and create your new account. Simple, fast and effective. And for those who have some problems with unwanted guests, the platform has also deployed a function to disconnect squatters and gently encourage them to subscribe to their own subscription (see our practical sheet).