Netflix will start clamping down on customers who share their accounts with people outside their households early next year.
The streaming giant announced the plan in its latest quarterly results presentation on Tuesday, 19 October 2022.
Netflix said it has landed on a “thoughtful approach” to monetize account-sharing and will implement two new features based on consumer feedback.
“We are going to offer the ability for borrowers to transfer their Netflix profile into their own account, and for sharers to manage their devices more easily and to create sub-accounts, if they want to pay for family or friends,” Netflix stated.
“In countries with our lower-priced ad-supported plan, we expect the profile transfer option for borrowers to be especially popular,” Netflix said.
Netflix announced its Profile transfer feature on Monday, saying it would be rolled out gradually, with customers notified via email when it has been enabled on their account.
It will enable users to migrate their personalised recommendations, viewing history, saved games, and other settings.
The sub-account feature has been in testing in Chile, Costa Rica, and Peru since March 2022.
Customers in these countries can pay an additional fee for an add-on account for family or friends at a fraction of a Netflix Standard subscription.
Netflix will also allow add-on users to migrate their profiles, including viewing history, lists, and personalised recommendations.
While Netflix plans to roll the feature out globally, it is not yet clear when it will arrive in South Africa or what it will cost.
If it works out to also be around 23-29% of the Standard price, as is the case in the testing countries, it should cost between R37 and R46.
In Honduras, Netflix has also tested adding a secondary location for a fee of $2.99 (R54) if an account is used outside a primary household for more than two weeks.
The plans should not surprise anyone who has followed Netflix’s recent developments and feature tests around the world.
Netflix has come under pressure in recent months, with subscriber growth slowing down and competition in the streaming industry heating up.
According to an analysis by Citi Group’s Bazinet, Netflix and other streaming services lose roughly $25 billion in revenue per year due to account sharing.
The streaming giant’s losses account for an estimated 25% of that figure, or roughly $6 billion.
Netflix has also attempted to lure in more paying customers by launching an ad-supported Basic package at a much cheaper price than the ad-free subscriptions, with a fee of $6.99 (R126.69) in the US.
This is currently only offered in 12 countries, with South Africa excluded.
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However, South Africa already has a cheaper entry-level option with the Netflix Mobile plan, at R49 per month, which is not available in the countries getting the ad-supported service.
Source: My Broadband
