Netflix has hinted they are going to further crackdown on password sharing.
The streaming service revealed to shareholders the measures they intend on taking after the number of subscribers dropped by 200,000 in the first financial quarter following the fee hike and the departure from the Russian market in light of the invasion of Ukraine.
On Tuesday (18.04.22, shareholders were told: "Our revenue growth has slowed considerably” as they warned that they expected a further two million users to leave them
They went on: "Our relatively high household penetration - when including the large number of households sharing accounts - combined with competition, is creating revenue growth headwinds."
Netflix believes that more than 100 million households are violating the terms and conditions by sharing passwords with people they do not live with.
Reed Hastings, the CEO previously ruled this as "something you have to learn to live with,” before saying a lot of it is “legitimate” between family members. The company also asserted that the practice drummed up more business as people were becoming more acquainted with their service, however now it is causing growth to slow.
Reed said: "When we were growing fast, it wasn't a high priority to work on [account sharing]. And now we're working super hard on it.”
Currently, they are testing out adding users for an additional fee (£2.30) - on top of the base subscription in certain Latin American markets.
No method was given about how they would police the rule but called all their ideas “customer centric”.
