Australia was used as the test market, now Netflix is rolling out their ‘No sharing Passwords ‘program to the USA and the UK in a move that could rake in mullions for the streaming service that’s been losing subscribers.
The big difference is that Netflix is offering overseas market consumers and family members who had been sharing a password a cheap incentive to re-sign with Netflix. The same offer was not made in Australia.
Overnight US customers who wish to continue sharing their accounts with people outside their household were sent emails giving them the option to share their account for an additional US$8 a month. The option is only available to customers of its US$15.50 standard plan and its US$20-a-month premium version.
The crackdown on password sharing, which began last year in Australia and Latin America, is a key part of Netflix’s strategy to generate more revenue from users.
Australian were used as the bunnies in a test market program which resulted in thousands of people who shared and then were cut off signing up for Netflix.
Netflix claims that as many as 100 million households globally use an account they don’t pay for, including 30 million in the US and Canada alone.
People who aren’t paying for an account and are just using a friend’s password will ultimately be cut off.
Greg Peters, Netflix’s co-chief executive officer, told investors last month that the password sharing crackdown is very much like a price increase in terms of customer reaction. Some people initially cancel, but ultimately subscriptions and revenue rise.
“That’s a really strong confirmation that we’ve got an approach that we can apply in many different countries with different market characteristics, including our largest revenue countries,” Peters said on an earnings call.
