Here's Why Netflix's Password Crackdown Is Backfiring

After beta testing in Spain, New Zealand, and Canada, the Netflix password crackdown has reached the U.S.

American users who share a password "outside their household" received a corporate policy change email recently. For $7.99 per month, you can add one non-household member to the $15.49 Netflix Standard plan. Netflix Premium with 4K streaming costs $19.99 per month, and you may add two members for $7.99 each.

The move is widely considered as a response to the company's tough 2022, when the once-invincible streaming giant lost customers for the first time, sending the stock down. Netflix profited from the outbreak because those forced to stay home and work streamed more shows and movies.

Younger Viewers Cancel More The crackdown is already unpopular with Zoomers and Millennials. Samba TV research predicts these significant groups would quit their memberships due to the password sharing crackdown.

Samba and HarrisX revealed that 52% of Gen Z and 51% of Millennials would discontinue Netflix if password sharing was forbidden. Only 25% of Gen X and Baby Boomers would leave the service. Samba showed that 37% of Netflix members would cancel if password sharing was banned.

64% of Netflix users, including 76% of Millennials, would subscribe if they couldn't use someone else's login, according to Samba TV's survey. 39% of password-moochers chose the $7 per month ad-supported plan and 25% chose an ad-free tier. Samba TV CEO Ashwin Navin noted that Netflix is pushing its ad-supported tier.

“Data from Samba TV and HarrisX shows the crackdown on password sharing has the potential to hasten the growth of Netflix’s ad-supported tier as sharers are gently forced to migrate to their own accounts,” Navin added."Almost 40% of those who use someone else's Netflix account say they'd switch to the cheaper monthly subscription with ads, while only 25% may sign up for their own ad-free experience."


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