How Netflix could crack down on password sharing, according to lawsuit

  • Netflix said last month that it expects to roll out paid sharing more widely by the end of March.
  • Paid sharing is being tested in Latin America, where it costs up to $3 to add an additional member.
  • The help section in test countries describes how it works, with a temporary access code for travel.

With Netflix expected to have about eight weeks to roll out plans to end free password sharing more broadly, a trial in Latin America gives an indication of how the changes might be rolled out globally.

Netflix’s help sections for Peru, Costa Rica, and Chile — where the streaming company tested the changes — explain how it uses IP addresses and device IDs to identify where the account is being accessed from.

Users in the test areas will need to set up a “primary location” via their TV, which will be confirmed via email or text message. If someone tries to access a Netflix account from outside of their primary location, their device will be locked.

Netflix is ​​also telling customers at test locations to watch something every 31 days, otherwise their device may become disconnected from their primary location.

“If you’re traveling or living between different locations, you can still enjoy Netflix,” the help center adds. It also says users can request a temporary access code that will last for a week and change their primary location at any time via a TV. Alternatively, customers should “consider adding an additional member to your account”.

With paid sharing, users can let people outside of their household use their account for an additional fee. In a Jan. 19 letter to shareholders, Netflix said it expects to “roll out paid sharing more broadly” by the end of Q1 2023.

The company also noted that its terms of service already limit account usage to a single household, but “we recognize that this is a change for members who share their account more broadly.”

It’s unclear if the wider adoption of password-sharing controls will be exactly like the study conducted in Latin America. Netflix declined to comment when contacted by Insider.

In countries where Netflix has tested paid sharing, it costs $2 to $3 to add an additional member, the company said. However, some Peruvian Netflix subscribers told Rest of World that they have not faced enforcement of the ban on sharing passwords.

This anticipated rollout follows November’s launch of an ad-supported subscription tier, showing users up to five commercials per hour. At $7 per month, Basic With Ads is $3 less than the cheapest ad-free tier.

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