Netflix to test a new ‘add a home’ option to charge for password sharing
Today, Netflix said that it will start experimenting in a few nations with a new “add a home” function that will tax subscribers who share their subscription with others. The test is the streaming giant’s most recent effort to combat password sharing. If a user uses an account outside of their home during the test, they will be prompted to pay an extra cost. Next month, Netflix will start testing the function in Argentina, El Salvador, Guatemala, Honduras, the Dominican Republic, and Guatemala.
Each Netflix account will feature a home in these test areas where you may access Netflix on any of your devices. Netflix will charge you a fee if you permit someone to use your account at a different residence. In Argentina, you must spend an additional 219 pesos, and in the other test regions, $2.99, to add a house to your account. Basic Netflix subscribers may add one additional house, Standard subscribers may add up to two more homes, and Premium subscribers may add up to three additional homes. Users will have the choice to manage where their accounts are utilized in these test locations and delete houses from their account settings page.
Netflix’s head of product innovation, Chengyi Long, praised the fact that its users wanted to share Netflix movies and TV episodes with more people in a statement. However, the extensive usage of account sharing among households today compromises our capacity to make long-term service improvements and investments.
According to Netflix, this test builds upon the “add another member” option, which was introduced earlier this year in Chile, Costa Rica, and Peru. In this test, customers who share the service with anyone outside of their own home are required to pay an additional fee. With this option, households may add up to two “sub accounts” at a price that’s less than what it would cost to subscribe to Netflix at full price.
According to Netflix, this approach doesn’t rely on GPS-based position information. Instead, it is making use of the same data it now utilizes to offer its service to its end consumers, including an IP address, device IDs, and other details about devices registered into the Netflix account around the home. By using this technique, Netflix can determine when persistent sharing occurs outside of a home.
During the first-quarter earnings conference, the business disclosed plans to extend testing that charge users more if they share their accounts with others outside of their home. In order to find the correct balance in terms of how much more to charge customers who have shared their Netflix account with people outside of their own home, Netflix has made it clear that it will need to continue to iterate on the feature for around a year.
Currently, Netflix estimates that over 30 million families in the United States and Canada are among the approximately 100 million households worldwide who share user accounts. According to Netflix, by increasing the fees for customers who share their accounts, it intends to strike the proper balance between continuing to allow sharing while also assisting in generating income from everyone who uses and enjoys the service.
In addition to these testing, Netflix has also announced that it would roll out an ad-supported plan as a strategy to monetize its member base. Announcing last week that Microsoft will serve as its “global advertising technology and sales partner,” Netflix hopes to monetize its streaming service through advertisements.