Netflix’s latest attempt to end illegal password sharing involves charging accounts with profiles in multiple households an additional fee, the streaming pioneer said on Wednesday.
The company is testing the latest feature in Chile, Costa Rica, and Peru, allowing members of its Standard and Premium plans to add up to two people who don’t live with them for an additional monthly fee.
It announced the move in a blog posted by one of its San Francisco-based executives, hinting that the US could be next in line for the premium. Netflix got freeloading customers, which cost the streaming giants money that could be spent on getting TV shows and movies up and running.
The additional costs are CLP 2,380 (USD 2.98) in Chile, USD 2.99 in Costa Rica and PEN 7.9 (USD 2.11) in Peru. Netflix notes that this is cheaper than if the secondary users got their own accounts, which range from $9.99 to $19.99 per month in the US.
In addition, these two additional members can have their own profiles, personalized recommendations, login and password.
The announcement was made on Wednesday and the new fee will first be tested in Costa Rica, Peru and Chile before rolling out to other regional markets
Chenyi Long, director of product innovation at Netflix, said the streaming giant’s new fee will be invested in bringing new TV series and movie catalogs to users
Netflix is also exploring another feature that will allow members on a Basic, Standard, or Premium plan to transfer their profile information to a new account or sub-account that will store data like viewing history and personalized recommendations.
The company currently allows people who live together to share their Netflix account. However, the plans have created some confusion over when and how accounts can be shared, the company said, adding that it hurts its ability to invest in new content.
“We recognize that people have plenty of entertainment choices, so we want to make sure any new features are flexible and useful for members whose subscriptions fund all of our great TV shows and movies,” wrote Chengyi Long, Director of Product Innovation at Netflix , in a blog post.
She added that the company will test the new feature for its personal use before making changes in other parts of the world.
Netflix is cracking down on users who share their passwords with people outside of their household by charging an additional fee for accounts with profiles registered in different locations, the streaming pioneer said on Wednesday
Netflix said it will also allow members on a Basic, Standard, or Premium plan to transfer their profile information to a new account or sub-account that stores data like viewing history and personalized recommendations
Password sharing is prohibited under Netflix’s terms of service, but the company has been largely permissive about the practice over the years. In 2016, the streaming giant even said that sharing passwords is acceptable as long as users don’t make a profit from selling their account information.
However, since last year, Netflix has been testing new countermeasures, including displaying a prompt on the screens of viewers using accounts from people living in other households.
It says, “If you don’t live with the owner of this account, you’ll need your own account to continue watching.” Users were then given the option to verify the account with a text or email code, or start their own Netflix trial.
Meanwhile, Netflix’s latest indictment comes after the company increased the cost of its subscription plans earlier in the year. In January, the company raised its US prices by $1 to $2 per month, depending on the plan, to pay for new programming to compete in the crowded online streaming market
The standard plan, which allows two simultaneous streams per account, is now $15.49 per month in the US, up from $13.99. Prices also rose in Canada, where the standard plan went from $14.99 to $16.49.
The price hikes, the first in those regional markets since October 2020, follow the streaming service’s “squid game.” The popular Korean series was an instant hit after it premiered in September 2021 and has continued to attract viewers ever since.
In addition, the US price of Netflix’s Premium plan, which allows for four streams simultaneously and streaming in Ultra HD, has increased by $2 to $19.99 per month.
For Netflix’s basic, single-stream plan, the cost increased by $1 to $9.99 per month.
In Canada, the premium plan increased by C$2 to C$20.99 and the base plan remained unchanged at C$9.99.
The United States and Canada combined is Netflix’s largest region, with 74 million customers as of September 2021. Most of the company’s recent growth has come from new overseas markets.
Total global subscriptions hit 222 million in January 2022, making the streaming giant a global success since it first started charging customers $7.99 per month for its standard subscription plan in 2013. The first price jump was in April 2014 when the price moved to $8.99 per month.
In October 2015, standard monthly subscriptions increased to $9.99 per month and in September 2017 to $10.99 per month.
About two years later, in January 2019, the price increased by another dollar to $11.99 and again in October 2020 by another dollar to increase the monthly subscription cost of $13.99.
Netflix’s subscription plans also retain the top spot for the highest price for a monthly service compared to its streaming competitors.
The second highest prices for standard plans are between Paramount Plus and HBO Max at $14.99 per month, then Amazon Prime Video at $12.99 per month, Disney+ at $7.99 per month, Hulu at $6.99 per month and Peacock at $4.99 per month.
Apple TV and Discovery Plus are also currently $4.99 per month.