Video streaming platform Netflix plans to increase subscription prices after their shares plummeted due to a password-sharing policy that was deemed detrimental. So far, Netflix has allowed its subscribers to share their passwords or passwords. In fact, the service's policies are driving the company's growth by getting more people to use and enjoy Netflix. However, the password sharing service has recently been detrimental to the company. Therefore, the company is trying to find the best way to monetize the password sharing service. According to company data, of the 222 million people worldwide who subscribe to Netflix, it is estimated that an additional 100 million people can use the same account to enjoy the video streaming service without subscribing. Netflix also claims this account sharing is a significant factor in the lack of user growth. In fact, the company said it had lost 200,000 customers in the first quarter, which was the most customer loss in a decade. Netflix CEO Reed Hastings said in 2016 that sharing passwords was not a problem. However, it looks like he's changed his mind now, because according to the Aura Survey 2021, 53 percent of Americans admit that they share their Netflix account passwords with other people in their homes. That's why Netflix is in the early stages of looking for ways to make more profit from its subscription password sharing service. One possible way is to increase the price slightly to be able to share the subscription account password. This means that you have to pay more so that additional people can use your Netflix account.
The company has also launched two test features in three overseas markets called "Extra Member" and "Profile Transfer". The costs incurred vary based on several additional factors. For example, for the "Extra Member" feature, subscribers to Netflix's standard and premium plans can add accounts for up to two people to share passwords. Even though they have to pay more, these additional members will also have full access to their main Netflix account and have their own profile and login. As for the "Profile Transfer" feature, subscribers are allowed to transfer profile information on various types of subscription plans to a new paid account, including viewing history. Currently, both of these new Netflix features are being tested in Chile, Costa Rica and Peru which are considered to be as a smaller market before launching it on a larger scale.
"We've always tried to make sharing with other members at home easy, with features like profiles and multiple video streams. While we won't be able to monetize everything at this time, we believe this is a great short-to-medium term opportunity." company.
In addition, making customers pay for the privilege of sharing accounts is also said to be a boomerang in itself. What's more, Netflix has raised prices earlier this year to compensate for moving its subscription base.
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