When the news of Netflix cracking down on password-sharing broke, a lot of people were disappointed. After all, it was the end of free streaming for some users. However, despite the negative feedback, the new policy seems to be bringing in more revenue.
Netflix's Gamble is Paying Off
The streaming service's added fee for extra users outside a household was a risk. There was a possibility that users would rather switch to streaming services where they can watch freely anywhere they want, or they would give in and abide by it.
Surprisingly, the tactic is actually working. As others predicted, Netflix started issuing the additional payment for outside users to reel in more subscribers, given that they'll have to pay extra anyway, and that's exactly what is happening.
There has been an evident increase in subscribers as soon as the company announced the policy in late May. Around that time, there were 73,000 daily signups, which amounts to a 102% increase compared to the company's 60-day average.
Although the panic subscription eventually died down before the week was over, the recorded increase in subscribers was still impressive. As mentioned in The Verge, Netflix saw 100,000 new subscribers between May 26th and May 27th.
In contrast, that is higher than the number the increase in subscribers during the pandemic's lockdown period back in 2020, when people were expected to turn to streaming services as they were forced to stay at home with nothing much to do.
The new password-sharing policy says that account holders will have to pay an extra $7.99 per month to share their account outside the household, and that's just for two people. Compare to the Standard with Ads tier, which is at $6.99., it actually costs more.
For account holders sharing their accounts with family outside the household, it might make sense to pay the extra $7.99. However, for friends or acquaintances who just want to stream shows for free on your account, it might not be a viable option.
Should You Just Make Another Account?
If you're a family member or a friend who just lost access to a Netflix account in a different household, you might want to think about getting your own this time, especially since the additional monthly fee already costs a dollar more than the ad-tier option.
The Standard with Ads subscription tier will allow you to watch on two screens at once. However, there are certain limitations. For example, video quality can only be in Full HD, and a few of the TV shows and movies on Netflix will not be available.
You can choose to subscribe to the Basic tier, which lets you watch ad-free and access all movies and TV shows. But, you'll be limited to one device at a time and you also be limited to a lower video quality in HD.
The Standard subscription will cost you twice as much as the additional fee for password sharing, but you will be able to watch on two screens at a time with no ads, and the video quality goes back up to Full HD. You can also add one member that's not in your primary household.
