Netflix Will Prompt Subscribers to Pay for Users Outside Their Households in New Test to Address Unauthorized Password Sharing (EXCLUSIVE)
Netflix will soon launch a test letting primary account holders pay an additional fee for users outside their households — a new attempt by the company to address illicit password-sharing.
According to the Netflix terms of service, a customer’s account “may not be shared with individuals beyond your household.” After years of turning a blind eye to password-sharing behavior that falls outside that requirement, the company last year ran a limited test prompting users to enter their account credentials as a way to nudge freeloaders into paying for their own accounts.
More from Variety
Netflix Could Reap $1.6 Billion per Year by Charging Password-Sharing Users Extra Fees, Analysts Say
'Stranger Things 4' Leaning 'Much Harder Into Horror,' Some Fan Theories 'Startlingly' Accurate
Netflix Top 10: 'Bad Vegan' Debuts With 27 Million Hours Consumed in First Five Days
Now, in an upcoming test launching in three countries — Chile, Costa Rica and Peru — Netflix will let members who share their accounts with people outside their household do so “easily and securely, while also paying a bit more,” according to Chengyi Long, director of product innovation at Netflix. The new options will roll out in the next few weeks in the three countries (and may or may not expand beyond those markets).
SEE ALSO: Why Netflix Is Moving to Collect Fees From Password-Sharing Violators
“We’ve always made it easy for people who live together to share their Netflix account, with features like separate profiles and multiple streams in our Standard and Premium plans,” Long wrote in a blog post about the test. “While these have been hugely popular, they have also created some confusion about when and how Netflix can be shared. As a result, accounts are being shared between households — impacting our ability to invest in great new TV and films for our members.”
With the “add an extra member” feature, members with Netflix’s Standard and Premium plans will be able to add subsidiary accounts for up to two people they don’t live with, each with their own profile, personalized recommendations, login and password — for less than the cost of a separate Netflix plan.
In the test countries, the cost for adding a sub-member is 2380 CLP in Chile, $2.99 USD in Costa Rica, and 7.9 PEN in Peru. Here’s a breakdown of the pricing of Netflix’s plans in each country:
As with other tests the streamer has conducted, there’s no guarantee that the option to pay for non-household members will end up a permanent part of the service. “We’ll be working to understand the utility of these two features for members in these three countries before making changes anywhere else in the world,” Long wrote in the post.
In addition, Netflix is testing out the ability to let subscribers transfer user profiles to new accounts, which would make it easier for password moochers to pay for their own plans. Members in the three test countries can allow people who share their account to transfer profile information either to a new account or an Extra Member sub account — preserving their viewing history, My List and personalized recommendations info.
Click here to subscribe to Variety’s free Strictly Business newsletter covering media earnings, financial and investment news and more.
In the three test markets, Netflix over the next few weeks will notify members who share their account outside their household about the new options. A member may be prompted to verify their account only if a device outside of their household logs in to the account; Netflix may then ask the user to verify the login from the device by sending a verification code.
Netflix ended 2021 with 221.8 million total paying subscribers worldwide. Of those, 75.2 million (34% of the total) were in the U.S. and Canada.
Best of Variety
Sign up for Variety’s Newsletter. For the latest news, follow us on Facebook, Twitter, and Instagram.