Netflix Inc. will ask customers in five Latin American countries to pay a fee if they want to use their account in an additional home, a test the company hopes will generate additional revenue by getting customers to pay to share their Netflix account.
Netflix believes that password sharing is one of the core reasons for its flagging user growth.
Customers in Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic will be asked to pay an extra fee if they use an account for more than two weeks outside of their primary residence, the company said Monday. This won’t affect the use of Netflix on mobile devices such as smartphones, tablets, or laptops, nor will it affect people on vacation. The additional home will cost 219 pesos ($1.70) in Argentina and $2.99 in the other countries.
Frankly, we’ve been working on this for about almost two years … a little over a year ago, we started doing some light test launches that … informed our thinking and helped us build the mechanisms that we’re deploying now,” Netflix’s chief product officer Greg Peters explained on the earnings call. “We just did the first big country tests, but it will take a while to work this out and to get that balance right.”