NETFLIX announced on Tuesday that it will start charging users who share their passwords between households starting next year.
Subscribers are being asked to spend extra to add members who don’t live with them in the latest crackdown on account sharing.
It showed up last month that the streaming giant has already tested the additional fees in Chile, Costa Rica and Peru.
Users who share passwords have to shell out around £2.70/$2.70 on top of their monthly subscription fee.
During its first-quarter earnings call on Tuesday, Netflix said it would expand its test to other countries, including the United States, next year.
The tech titan stressed that it will continue testing the feature over the next 12 months before rolling it out more widely.
“Honestly, we’ve been working on this for about two years…just over a year ago we started with some light test launches that…influenced our thinking and helped us develop the mechanisms we’re using now,” he explained to Greg Peters , Netflix’s Chief Product Officer, on the conference call.
“We’ve just done the first major country tests, but it’s going to take a while to figure that out and find the right balance.”
It’s not clear how Netflix will recognize password sharing, but last year it started testing a Prompt that prevents freeloading.
Users are banned from sharing their account with anyone outside of their household, but Netflix has long turned a blind eye.
After the recent raid, bill payers can add sub-accounts for up to two viewers who live elsewhere without breaking the rules.
Netflix said it needs to somehow contain the issue so it can keep investing in new big-budget TV shows and movies.
But with recent subscription increases, many will not be pleased at the prospect of being squeezed even further.
Just last month, hitmakers Squid Game and Bridgerton announced plans to increase the cost by up to £24 a year in the UK.
Prices for the Basic and Standard plans increase by £1 per month to £6.99 and £10.99 respectively.
While customers with the premium package have to pay an additional £2, it now costs them £15.99.
Since January, the price has been raised in the USA and Canada also.
As part of this new move, the company has announced that subscribers can also transfer profiles to a new account or additional sub-account.
This means they can take their entire TV history, favorite shows and personalized recommendations with them.
“We recognize that people have many entertainment options, so we want to ensure that any new features are flexible and useful for members whose subscriptions fund all of our great TV shows and movies,” said Chengyi Long, Director of Product Innovation at Netflix .
“We will work to understand the benefits of these two features for members in these three countries before we make any changes anywhere else in the world.”
Netflix is looking for ways to boost its revenue after subscription numbers have skyrocketed during the Covid-19 lockdown.
However, rising subscription costs and increasing competition from Amazon Prime and Disney+ are taking their toll.
On Tuesday, Netflix announced that it had lost subscribers for the first time in a decade.
Netflix ended the first quarter of this year with 221.6 million subscribers, down slightly from the last quarter last year.
The company blamed the quarterly erosion on the suspension of its service in Russia due to the Moscow invasion of Ukraine.
The Silicon Valley technology company reported net income of $1.6 billion for the recently ended quarter, compared to $1.7 billion for the same period last year.
Netflix shares fell about 25 percent to $262 in aftermarket trading following the release of earnings results.
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