How is the password crackdown affecting Netflix’s subscriber numbers?

For a long time, Netflix had turned a blind eye to password sharing as it contributed to its growth. However, the streaming giant faced significant subscriber losses last year and realized that password sharing was negatively impacting its revenues, limiting its ability to invest in new content. It’s estimated that over 100 million households worldwide engage in account sharing.

To address this issue, Netflix took various measures to address password sharing, including implementing stricter login authentication procedures and exploring technologies that can detect and prevent unauthorized account access. The streaming service also recently informed its US subscribers that sharing passwords with individuals outside their household would require adding an additional member to their account for a monthly fee of $7.99, or they could opt to sign up for a new account altogether. The company also intends to block users with unauthorized passwords.

This crackdown on password sharing began earlier this year in several countries, including Canada, New Zealand, Portugal, and Spain.

Now, Netflix’s clever move to crack down on password sharing is paying off in the US.

Netflix reaches highest level of new subscribers

The streaming service has seen a massive surge in new subscribers, even bigger than what they experienced during the early days of the Covid pandemic. Based on Antenna, a streaming analytics company, Netflix had its biggest days ever for new user sign-ups in the US in late May. The company has been measuring the service for over four years.

According to Antenna’s data, Netflix added 100,000 new accounts on May 26 and May 27, right after the crackdown kicked in. In the following days, they saw an over 100% increase in sign-ups compared to the average of the past 60 days, reaping the benefits of their bold move.

“These exceed the spikes in sign-ups Antenna observed during the initial US Covid-19 lockdowns in March and April 2020,” the firm said in a report. It also noted that “cancels also increased during this period, but not as much as sign-ups.”