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Netflix tests a new way to charge users who share password with friends

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After confirming a significant loss in subscriber numbers earlier this year, Netflix has reportedly been working on new ways to retain its subscribers and also recover its revenue. One of these methods is now being rolled out in Latin American countries, as Netflix has begun charging for password sharing there.

Get ready for some hard conversations.

On Wednesday, Netflix announced an upcoming test that is sure to cause drama amongst the account-sharing set. The streaming service said that, over the next several weeks, it will begin prompting some people who share accounts outside of their immediate household to pay extra to continue doing so.

“Members on our Standard and Premium plans will be able to add sub-accounts for up to two people they don’t live with — each with their own profile, personalized recommendations, login, and password — at a lower price,” read the announcement in part.

Notably, the sub-account test is for now limited to subscribers in Chile, Costa Rica, and Peru. That doesn’t necessarily mean that it will remain there. When pressed, Netflix would not provide specifics on any plans to expand the test beyond those three countries. Netflix would also not confirm how many users live in the countries subject to this test.

How Netflix detects homes

  • We use information such as IP addresses, device IDs, and account activity.
  • If you are using a device within your included home and still see a message that says that too many homes are using your account, you can:
  • Make sure that the device is connected to the same internet connection as the other devices in the home.
  • Make sure that the device is not connected to a VPN, proxy, or any unblocker service.
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Netflix explains that your use of Netflix on a TV outside your home while “traveling” is eligible without an extra charge for up to two weeks, “as long as your account has not been previously used in that location. This is allowed once per location per year.”

Netflix cracking down on password sharing

Back in April, Netflix blamed users who share their passwords with friends and family for losing more than 200,000 subscribers in the previous quarter. According to the company, the platform today has more than 100 million users who don’t pay for a Netflix subscription.

In a note to employees, Netflix said it was aiming to crack down on password sharing – and now this is becoming a reality, at least in a few regions. As reported by Bloomberg on Monday, Netflix is now testing charging for password sharing in five different Latin American countries: Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic.

In these countries, customers are now required to pay an extra fee if they use an account for more than two weeks outside their primary residence. For now, the system uses TVs to identify multiple logins in different locations, as Netflix says users won’t have to pay the extra fee to watch Netflix on smartphones, tablets, or computers.

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