Netflix co-founder and director Reed Hastings delivers a speech when he opens Netflix France’s new offices in Paris on January 17, 2020.
Christophe Archambault | AFP | Getty Images
Netflix has never given much importance to password sharing, but a new test suggests the company may be reconsidering.
Netflix is testing a new policy with some customers, causing certain people to sign up for a separate account if they are not watching with the subscriber.
The message says, “If you don’t live with the owner of this account, you need your own account to continue watching.” Streamable first reported on the trial.
According to a spokesman, Netflix tries “hundreds” of tests a year with selected customers. The trial may not lead to further crackdown on password sharing. The test can be applied for account security as well as for sharing passwords.
“This test is designed to help ensure that people using Netflix accounts are authorized to do so,” said Netflix in a statement.
About 33% of all Netflix users share their passwords with at least one other person, according to research firm Magid. Netflix’s basic plan costs $ 8.99 a month. The company’s standard plan is $ 13.99 a month, which allows users to watch Netflix on two screens at the same time. Historically, Netflix has not done much to prevent sharing passwords, as the strong growth in the number of subscribers and the price of its shares outweighed any concerns about lost revenue.
Netflix announced earlier this year that it had surpassed 200 million global subscribers, but the shares underperformed the S&P 500 this year as investors moved away from growth stocks. Netflix should also avoid a host of new streamers – including Disney +, HBO Max from AT&T, Peacock from NBCUniversal and Paramount + from ViacomCBS – to ensure that users do not migrate to competitive services.
Disclosure: NBCUniversal is the parent company of CNBC
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