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Netflix Shares How Much Password-Sharing Actually Costs Them

Netflix has shared how much password-sharing actually costs them.
Credit: Netflix

Netflix has shared how much the company loses from password-sharing.

The streaming giant has an estimated 231 million subscribers, who pay to watch its huge array of films and TV shows.

It has many talked about programmes, including Stranger Things and Wednesday.

While it also has a ton of popular films to stream, such as Don’t Look Up, Red Notice, and Glass Onion: A Knives Out Mystery.

But it’s recently faced criticism after announcing plans to cut down on account sharing – despite famously once tweeting: “Love is sharing a password.”

So Netflix has now released some statistics to support its decision.

Find out the potential consequences of Netflix’s password-sharing plans below…

Initially, the streaming platform announced its plans to only allow users to account share if they live in the same household.

So if families are spread across different households, users would have to log in on their device from their home Wi-Fi network (the address where the account is linked to) once every 31 days – which isn’t ideal if you live away from home.

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As this was met with a huge backlash, Netflix has altered and updated its plans.

The streaming giant has shared a number of new proposals, including customers having to upgrade to the standard and basic subscription if they want to share their accounts with people who do not live in the same household.

Watching Netflix.
Netflix has shared how much the company loses from password-sharing. Credit: Alamy

In the proposal, it also says: “We’ve always made it easy for people who live together to share their Netflix account with features like profiles and multiple streams.

“While these have been hugely popular, they’ve also created confusion about when and how you can share Netflix.

“Today, over 100 million households are sharing accounts — impacting our ability to invest in great new TV and films.”

So to put that in perspective, the standard Netflix subscription costs £10.99 ($15.99 in the US) and if 100 million people are sharing, that means Netflix is missing out on just over £1 billion a month ($1.5 billion).

People may argue that Netflix has enough money, but missing out on roughly a billion a month is surely going to ruffle some corporate feathers.

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Despite this move being unpopular among consumers, experts have suggested that other streaming services, such as Disney+ and Amazon Prime Video, could follow the trend in the near future.

Richard Lachman, an associate professor at Toronto Metropolitan University’s RTA School of Media, believes that it will soon become ‘industry standard’ as it is common for tech companies to copy one another.

He explains to CTV News that this concept is known as ‘copycat behaviour’.

This is when companies let competitors try out new business models and will then decide on whether they should copy them depending on consumer reactions.

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Written by Rosario Monachino

Rosario is a former content editor at IGV who specialized in film, TV, and entertainment news. He has a degree in English and Film from the University of Salford and a master's in Journalism from Liverpool John Moores University.