When Netflix first announced the coming of a crackdown on password sharing, there were a lot of questions about how it would go over. Customers were unhappy with the idea, as they had long exploited this loophole to save money on the service. Industry experts were split on how customers would ultimately respond. Some thought it would drive subscribers and others thought it would finally slay the beast that is Netflix. It appears the first group was correct, as Netflix has seen the biggest increase in new subscribers in years.
What is password sharing?
In regards to Netflix, password sharing is the process by which a single Netflix account is shared among multiple people. This allows the people sharing an account to access all of the content and features that come with it, usually at a fraction of what it would cost each person to have their own account. Many people create pacts where one pays for Netflix, one pays for Disney+, and another pays for Hulu, and they share passwords between them.
Netflix, at one point, seemingly supported this behavior. There is an infamous tweet from the company that said "Love is sharing a password." They also implemented multiple profiles, allowing people to create their own watch history, likes, and recommendations. While this was intended for people in the same home, it was definitely used by people sharing passwords.
Substantial subscriber growth
In the week following the May 23, 2023 crackdown, the company has seen incredible growth. In fact, they had some of their best days in over four and a half years. According to Antenna, the company has seen over 100k new users per day on two different days. According to the report,
Netflix has had the four single largest days of U.S. user acquisition in the four and a half years that Antenna has been measuring the streaming service. Based on the most current data available, Netflix saw nearly 100,000 daily sign-ups on both May 26 and May 27.
Despite subscription fatigue being a problem for many people, Netflix seems to be able to keep fighting that and bucking the trend. This growth after the crackdown suggests that people wanted to stay with the service and were willing to swap to their own accounts, apparently in pretty big numbers. It definitely means that people are not walking away from Netflix because they can no longer password share. While people may be annoyed that they can't do it anymore, it is unlikely that they will quit in disgust. It is important to note, however, that these numbers do not reflect the number of lost subscribers, but it is unlikely that it comes close to those numbers.
It seems that the move to crack down on password sharing may have been a brilliant one that will generate more revenue for Netflix. While some may have predicted that it would be the thing that finally takes down the streaming giant, it seems that it has only made it stronger. This growth after the crackdown shows that people are willing to pay for the service and that Netflix is still able to keep fighting subscription fatigue.