Beginning the next year, Netflix could start charging a charge for extra profiles that appear on accounts.
In the “who’s watching” display that pops when a user initially logs into the website, Netflix suggested it may start charging for each new user profile during its quarterly earnings call on Tuesday.
According to the New York Post, the proposal was initially made in April after a dismal financial report. It follows attempts by Netflix to discover methods to prevent consumers from sharing accounts without driving them away from the service.
The costs in the US can range from $3 to $4 based on the results of program pilots that have been run in Latin America.
Announcing this week that it attracted 2.4 million members in Q3 as a result of the popularity of the serial killer thriller Dahmer, Netflix also announced its first positive news of the year.
According to Netflix’s release, “We’ve settled on a deliberate method to monetize account sharing and we’ll start rolling this out more generally beginning in early 2023.”
We will provide sharers with the option to manage their devices more simply and to form sub-accounts, if they wish to pay for family or friends, after taking into account customer input.
Although it has always been against the law for users to disclose their passwords with other users, nothing has been done to enforce this policy in the past.
According to reports, account sharing costs Netflix roughly $6 billion annually, as reported by the Post.
In Latin America, where password sharing was a particularly pervasive issue, Netflix tested the notion of charging for extra accounts during the summer.
Now that the change is being widely implemented, it may make or break Netflix, which has been trying to find a solution to stabilize its declining profitability while keeping its subscription-based business model.
Netflix is doing all it can to protect customers from hacking and the sale of their data, according to analysts, but many believe it is only a matter of time until the company is compelled to do that.
Following the disclosure of its 200k subscriber loss in April, Netflix’s share price has fallen almost 65% since the year’s beginning. Another 970,000 people had left the site by the end of Q2.
In the past, Netflix has cited extensive password sharing by customers as one of the main reasons for its declining subscriber numbers, claiming that over 100 million households are abusing accounts that have been purchased by others.
It implies that users’ bookmarks, suggestions, and watching history are preserved when profile owners create their own Netflix accounts.
According to Netflix, the service enables account holders to quickly move their profile from the account of a person with whom they are no longer in touch, such an ex-boyfriend.
However, it also motivates Netflix users to create and pay for their own accounts rather than ‘freeloading’ off of another user’s.
The “highly sought” function is currently rolling out to all customers globally, according to Netflix, and an email will be issued to each account as soon as it becomes accessible.
Starting in November, the site will also provide an advertisement-based subscription service for $6.99 per month.
The Netflix terms of service state that account users must reside in the same home, yet there was nothing to prevent the account from being utilized across several houses.
In actuality, it meant that five individuals with five different addresses might each have a profile under a single account.
This eliminates a possible source of income for Netflix and “undermines our long-term capacity to invest in and develop our service,” according to Netflix.