By the end of March of this year, Netflix intends to prohibit customers from freely sharing passwords, the firm just announced in a letter to shareholders.
The streaming juggernaut announced back in October that it would start charging users who share their accounts, but it did not provide a specific date or any details regarding when the new policy would become effective.
Late last week, Netflix announced that it would roll out the paid sharing system across the platform in the latter half of the first quarter.
In a letter to shareholders, Netflix stated that “today’s widespread account sharing (100M+ homes) weakens our long-term ability to invest in and develop Netflix, as well as to build our business.” Although Netflix can only be used by a household under our terms of service, we acknowledge that this is a change for members whose accounts are shared more widely.
In order to enhance the Netflix experience, we have worked hard to develop new features that include the capability for subscribers to monitor which devices are using their account and to move a profile to a new account.
The business warned that the new rule will probably have a “negative impact” on “short term engagement” since some users may cease using the site because they can no longer sign up for a free account.
Despite the latest adjustments, Netflix reassured shareholders that engagement will increase “over time as we continue to produce a fantastic slate of programming and borrowers sign-up for their own accounts.”