Netflix has revealed that its crackdown on password sharing seems to be working after launching the feature last quarter in four countries, including Canada, New Zealand, Spain and Portugal. In the latest earnings report for Q1 2023, Netflix says the crackdown on password sharing or what the company calls paid sharing, will reach more countries, like the US, by late Q2, which should be around July, going by Netflix’s fiscal year. Earlier, the company was expected to roll out paid sharing in the US and some other markets by Q1.
The company’s revenue in Q1 2023 increased marginally (3.7 per cent) YoY to $8.16 billion from $7.87 billion. The streaming giant also expects growth in Q2 2023.
In its earnings report, Netflix notes that it launched paid sharing in four countries and is “pleased with the results.” The company plans a broad rollout, including in the US, in Q2, though details about India remain unclear. Netflix has clarified earlier that the crackdown on passwords will extend to Indian users also.
As per the new rules, Netflix says that users can use the same account (the one with the subscription) on multiple devices if only they are on the same network. Netflix states there are plans to launch a special subscription if users in different households want to use the same account, but details are limited.
On paid sharing, the earnings report highlights:
“We’re pleased with the results of our Q1 launches in Canada, New Zealand, Spain and Portugal, strengthening our confidence that we have the right approach. As with Latin America, we see a cancel reaction in each market when we announce the news, which impacts near-term member growth. But as borrowers start to activate their own accounts and existing members add ‘extra member’ accounts, we see increased acquisition and revenue. For example, in Canada, which we believe is a reliable predictor for the US, our paid membership base is now larger than prior to the launch of paid sharing and revenue growth has accelerated and is now growing faster than in the US.”
