Netflix prepares password-sharing crackdown after subscriber surge

19 Oct 2022

Image: © Natee Meepian/

The streaming giant plans to let users create ‘sub-accounts’ if they want to pay for family or friends, while letting borrowers transfer profile details to their own paid account.

Netflix has revealed its “thoughtful approach” to monetise account sharing, after beating third-quarter expectations in revenue and subscriber growth.

The streaming giant brought in 2.4m new subscribers in the quarter, which is a dramatic turnaround after its record loss of nearly 1m subscribers earlier this year.

It was then that the company said its short-term focus was to “reaccelerate revenue growth” by improving its monetisation features and cracking down on password sharing between multiple households.

Now, Netflix has said it plans to let users manage their devices more easily and to create “sub-accounts” if they want to pay for family or friends.

Those who are borrowing accounts will also be able to transfer their profile details to their own paid account. This feature began rolling out globally this week.

Netflix said it will roll out its broad crackdown on password sharing from early next year, with features currently being trialled in several countries in Latin America.

It previously estimated that its service was being shared to more than 100m homes that are not directly paying for it, making it “harder to grow membership in many markets”.

The streaming company expects the profile transfer option for borrowers to be “especially popular” in countries with the cheaper ad-supported subscription option. This new subscription model is being launched in 12 countries in November.

Netflix noted that it is developing new revenue streams through advertising and paid sharing. As a result, the company said it will no longer share projected subscriber targets in future earnings reports, as it is focused on overall revenue being its “primary top line metric”.

Netflix reported revenue of $7.93bn for the third quarter of the year, which is a year-on-year increase of 5.9pc and slighter higher than Refinitiv expectations. The company’s shares rose by more than 14pc after the quarterly results were published, CNBC reports.

Netflix also shared plans to focus more on gaming, one year after it first made a play for mobile gaming services. The company now has 35 games on its platform and said it has seen “encouraging signs” of gameplay leading to higher retention.

The company’s VP of gaming, Mike Verdu, said it is “seriously exploring a cloud gaming offering” and plans to open a new gaming studio in California, TechCrunch reports.

Netflix’s attempt to diversify its offering comes amid an increasingly crowded streaming market, with the launches of Disney+ in 2019, HBO Max in 2020 and Paramount+ in 2021.

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Leigh Mc Gowran is a journalist with Silicon Republic