Netflix is rolling out paid password sharing in Canada, New Zealand, Portugal and Spain as the company looks to reap revenue from a practice it long encouraged customers to engage in at no charge.
A blog post confirmed the rollout and said it would expand in the coming months. The announcement followed some online unrest earlier in the week when a company web page pertaining to tests of the password plan in Chile, Costa Rica, and Peru went live in other countries. (A trial of the new setup launched in those countries last year.) The bulletin ricocheted around online, causing anxiety over its apparent requirement for users to specify a “primary location” for a given household’s accounts. Backlash centered on the notion of having to verify WiFi information on a regular basis.
“We know there’s been a lot of confusion about sharing Netflix,” the company acknowledged in a tweet. “A Netflix account is intended for one household,” it continued, adding that the aim is to “give you more control over your account.”
Along with its push last fall into advertising, Netflix has identified password sharing as a significant revenue opportunity as its core business matures and faces increased competition and economic headwinds. Many Wall Street analysts have suggested it could bring billions in extra revenue, but the process of communicating the changes around password sharing are delicate, as even senior executives have readily acknowledged.
At the center of the streaming giant’s pitch to consumers is its belief that sharing by some 100 million accounts is hurting its ability to invest in original films and series.
The blog post notes that subscribers can already take a number of steps to ensure that multiple people are using a single account in a legit fashion. They can also “buy an extra member” (this is where the revenue opportunity comes in), with prices for doing so in the new territories coming in at CAD$7.99 a month per person in Canada; NZD$7.99 in New Zealand; Euro 3.99 in Portugal; and Euro 5.99 in Spain.
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