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Netflix free riders on borrowed time as competition ups the ante

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It’s been a bad week for your ex-partner’s brother’s girlfriend.

Just as she started to get in Peaky Blinders, Netflix has hinted that it is about to crack down on shared accounts. The login you lent her while she was in college could be stolen in the coming months.

She is not alone. The sprawling ecosystem of friends, neighbors, and relatives using your account for their evening Netflix viewing seems to be on borrowed time.

Until now, Netflix didn’t care that about a third of its users — 100 million households — are watching it on someone else’s account (not just a close family member, but a completely different home).

It was growing very fast anyway, adding millions of subscribers every year. But its growth has now stalled; it lost 200,000 subscribers for the first time. So it needs to start doing a little housekeeping.

And it’s your cousin, your teenage son’s sidekick, and your mom who look like they might be cut off anytime soon.

How could Netflix do that? A trial is underway in some South American countries where people are being asked to pay an additional €3 to allow people outside the account holder’s household – such as relatives or friends – to continue to have access to the content. The ultimate goal here might be to introduce cheaper payment tiers that seem less annoying to the beneficiaries of the split if and when they start cutting off those beneficiaries.

As for the crackdown machinery, it has already started rolling out measures like two-factor authentication, which effectively restricts access to those who have the cell phone number or email address linked to the account.

It could also consider something that approximates location-based credentials, possibly involving IP addresses. I’m skeptical, however, because part of the deal with Netflix is ​​that I can watch it on the bus, in a hotel, or in a coffee shop during my lunch break.

It could just do something simple, e.g. B. Asking current users to reset their passwords in a one-time action, a move that would almost certainly lock out millions of extended family members, former friends, and others who might be too embarrassed to call you to do so
updated password.

However, this might annoy people and prompt some who are thinking about quitting to do so.

But make no mistake: the era of Netflix free-for-all seems to be coming to an end.

As irritating as that may be for some, the company seems to be making it worth it. If just 10 percent of the 100 million households currently debiting others’ accounts pay, that would generate between €1 billion and €2 billion in additional fees a year.

Even for a company that’s expected to spend over $15 billion on movies and TV shows this year, that’s a very healthy incentive to do something. But to the bigger point of Netflix’s subscriber growth: Could it really be in trouble? Absolutely.

It’s not like the company did anything wrong. But its competitors are now much, much better than they used to be. Apple, which was nowhere three years ago, just won an Oscar for best picture.

Disney Plus, also not even three years ago, has a guaranteed readership through its exclusive Marvel, Pixar and Star Wars catalogues. And Amazon Prime Video, while it hasn’t done anything spectacular, has a Tesco Clubcard-like customer retention benefit that’s hard to postpone. So far, Netflix has held up against this competition fairly robustly. Last year it added more than 10 million subscribers, with numbers similar to the previous year.

And it still seems that Netflix is ​​the tentpole streaming app that has more cultural and entertainment twists and turns than any of its competitors.

Over a six-month period, Netflix still has more hits — shows or movies that get a lot of discussion — than competing platforms.

In my family, I’ve asked others which of the four main platforms (we all subscribe) would be sacrificed if we canceled one. Apple was the consensus answer, followed by Amazon. The one least willing to part ways was Netflix.

Still, Netflix can’t avoid the dismal and relatively sudden cost-of-living shock that many of us are going through right now. In a year when electricity and fuel bills are rising by a third, it’s been a little unfortunate that Netflix has increased its prices by as much as 31 percent (over a 12-month period). If it really is about turning down the heat or keeping Netflix, I’m not sure the streamer will win.

Despite all that, there’s one hot take on Netflix’s current spotlight that can safely be thrown in the bin. That means streaming platforms as a genre are in trouble. This is not supported by any reasonable data.

There is no scenario where the world will back away from online television and movies even slightly. If you have a broadband connection, use a streaming platform. If you’re in a family, you’ll have at least two subscriptions, and more likely three or four. (Anyone with kids under 12 will know they don’t have much of a choice on Disney Plus.)

Whatever happens, it’s a fair bet that Netflix will continue to dominate our movie lives for the foreseeable future.

https://www.independent.ie/business/world/netflix-freeloaders-on-borrowed-time-as-competition-ups-the-ante-41577415.html Netflix free riders on borrowed time as competition ups the ante

Fry Electronics Team

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