Last year, one of the most popular content streaming services began fighting against password sharing, something that was impacting their overall revenue. Yes, we’re talking about Netflix. The OTT platform prohibited users from sharing their passwords with users who weren’t in their household.
Here’s How Netflix Cracked Password Sharing
Per the official support page, “People who are not in your [the user’s] household will need to sign up for their own account to watch Netflix.” So far, the move has benefitted the platform by increasing its overall revenue and customer sign-ups. And now, another player is eyeing the same method to stop account sharing.
Disney Plus To Start Limiting Password Sharing
During an earnings call, Disney’s chief financial officer, Hugh Johnston, said the platform will start limiting password sharing beginning in March 2024. Anyone “suspected of improper sharing” or signing up from another user’s login credentials will be redirected to purchase a Disney Plus subscription.
Johnston Aims To Increase The Platform’s User Base
Currently, if someone wants to share a Netflix account with a person who isn’t living in their household, the platform asks for an additional fee of $7.99 per month. Disney Plus also plans to follow a similar strategy, allowing users to share their credentials for an extra cost. Johnston mentioned in the meeting that the platform is excited to launch the new feature and increase its subscriber base.
The new terms of using Disney Plus are already in effect for new users from January 25 and will apply to existing users from March 14. However, the platform hasn’t yet announced the exact fee it will charge users. It is important to mention that Disney Plus is not the only service to do this, as Hulu also updated its service terms.
Why Are OTT Platforms Restricting Password Sharing?
Like the other top companies, Netflix and Disney are struggling with soaring profits, and one of the primary reasons for this is password sharing. When one user shares their credentials with another who isn’t paying, the OTT platform loses a customer. At scale, this impacts the company’s overall revenue and, subsequently, its profits. Hence, restricting password sharing and encouraging users to create their own accounts benefits them.