Following in the footsteps of Netflix, Disney has begun its previously announced plans for a password sharing crackdown in the U.S. 

Research from earlier this year found at more than half of Americans were sharing passwords for streaming services. Netflix's password sharing crackdown, however, has been deemed a success in that it increased paid subscribers. 

This week Disney  began informing subscribers that “Disney+ expanded its paid sharing program to give its users ways to enjoy their Disney+ subscription along with a family member or friend, through the management of devices within a household. These features and capabilities are now available in the United States, Canada, Costa Rica, Guatemala, Europe, and the Asia-Pacific region after launching in select markets over the summer.”

Under the new plans, Disney said that people outside of the subscriber’s household, will need to sign up and pay for their own subscription or be added as an Extra Member to your account for an additional monthly fee to continue enjoying Disney+.

Account holders who want to add someone outside of their Household to their Disney+ subscription will be able to do so with the Extra Member add-on. 

In the U.S., an Extra Member profile will cost an additional $6.99 per month for Disney+ Basic subscriptions and $9.99 per month for Disney+ Premium subscriptions. 

However, only one Extra Member slot is available per account and the Extra Member offering is not available for Disney Bundle subscribers or for subscribers billed through partners at this time, Disney said. 

As an alternative to Extra Member, people outside a household can sign up for their own subscription to watch Disney+ and the account holder can transfer an eligible profile to a new subscription or Extra Member to keep that profile’s Disney+ watch history and settings, Disney said. 

Disney also assured subscribers that they could continue to watch content outside the home, but the ability to do so may require additional authentication. 

More information is available here. 

DURHAM, N.H.—While streaming video services like Netflix have worked to rein in password sharing, a new study from Leichtman Research Group (LRG) reveals nearly one-quarter of all the direct-to-consumer VOD streaming services measured are being shared by more than one household.

“Password sharing continues to be prevalent throughout the streaming video industry, despite recent efforts to limit it. This study found that 10% of all DTC services are borrowed from someone else, down from 12% in 2022,” said Bruce Leichtman, president and principal analyst for LRG. “Overall, 20% of households have at least one DTC service that is paid for by another household.”

Published in LRG’s new “Internet-Delivered TV Services 2024” study, its seventh annual, the research focuses on vMVPDs (virtual Multichannel Video Programming Distributors) and other DTC streaming video services.

On the plus side for service providers, of the households that subscribe to the 15 top DTC video-on-demand services LRG measured, 53% have signed up for four or more services. Nearly three out of four of them fully pay for those services and do not share them with those outside their households, the research found.

The study reveals that among the 23% of all DTC services used by more than one household: 11% are used and paid for by those who also share the with someone outside their home; 10% are used in one household but borrowed from another household paying for the service; and 2% are used by multiple households that share costs, it found. 

The research also found 4% of DTC services are not paid for because they are bundled with another service.

Subscription borrowing was more prevalent among younger respondents. A total of 17% of all DTC services are borrowed by those ages 18 to 34, compared to 7% among those 35 and older. The younger cohort accounts for 59% of all DTC services borrowed by an adult, according to the findings.

The efforts of Netflix to combat service borrowing appear to be paying off as just 10% using the service borrow it from someone else—down for 15% in 2022, it found.

Other findings of the research include:

• Among adults ages 18-44, the mean number of DTC services is 5.1, compared to four among ages 45-54, and 2.8 among those 55 and older.
• 6% of all households in the past year had Netflix, but currently do not—the is true for Hulu and the live pay-TV category.
• Adults 18-to-44-year-old adults account for 57% of all those with a vMVPD pay-TV service.
• 72% of vMVPD subscribers are very satisfied with their service, which is down from 79% in 2022.
• 22% of all vMVPD services are shared by multiple households, including 8% of all vMVPD services that are fully paid for by someone outside the household.

The findings are based on an online survey of 2,546 U.S. adults 18 years of age and older. It was conducted in February, and the online sample has a statistical margin of error of +/- 1.9%. 

More information is available on the company’s website. 

A new survey by Forbes Advisor finds that the password sharing crackdown by streaming services is having an impact but that the practice is still widespread. 

In a new survey of 2,000 Americans, Forbes Advisor found that even though 33% of Americans report having to create their own streaming account after password crackdowns, another 56% say they are still sharing passwords. 

Consumers also reported widespread resistance to further price hikes and crackdowns with 90% claiming they would drop streaming services if they hike prices or crackdown on password sharing.

The report also found that streaming usage is now widespread and heavy, with Americans spending an average of 20 hours streaming content every week, which is the equivalent of a part-time job. 

For that content, people are spending an average of $552 on streaming services a year or $46 a month. Many also reported they have been hit by rising prices, with 44% report having their streaming subscriptions costs increase over the last year. 

The survey also broke down the likelihood of subscribers canceling specific services. People are most likely to cancel Disney+ (44%) if their prices increased or they enforced stricter password sharing rules—33% would cancel Netflix if prices increased or account sharing was enforced.

The survey also found that the number of people paying for streaming services has increased over the last year—96% pay for at least one streaming subscription in 2024 while only 86% paid for streaming services in 2023. 

See our report and full methodology here: https://www.forbes.com/home-improvement/internet/streaming-survey/

NEW ROCHELLE, N.Y.—With an increasing number of streaming services following Netflix’s and Disney+'s lead in cracking down on password sharing, one in three U.S. TV content viewers (33%) are still borrowing log-in credentials or sharing the costs of at least one streaming service they can access, according to findings from Horowitz’s "State of Media, Entertainment, and Tech: Disruptions" report. 

The study found that the main drivers to borrowing and share are: “Someone I know already had an account”; “I can’t afford it at this time”; and “I am just doing it to access a specific show/type of content for a short period of time.”

The study also found that almost one in four (23%) viewers who currently borrow or share a password are “very worried” that the streaming services they use will start implementing measures to prevent sharing; another 26% are somewhat worried about it. 

Horowitz is, however, reporting that about half of those who borrow the log-in or share the cost for Netflix, Max, Disney+, Hulu, Amazon Prime Video, and Paramount+ would be willing to pay the full price for those services if they were not able to share anymore. Sharers of smaller, less robust services are less likely to pay full price for those services.

“Profitability continues to be a concern in the streaming space, and password sharing clearly plays a role in that. It is inevitable that services will need to find new revenue sources, whether from subscriptions or ads or both,” notes Adriana Waterston, executive vice president of insights and strategy lead for Horowitz Research. “That said, as more services crack down, we can anticipate that some consumers will consider churning off some of the services they share if they don’t see the value for their money. In that sense, the bigger services are risking less by cracking down than the smaller services, because the more robust and varied their content offering is, the more their perceived value.”  

In the context of these recent crackdowns, Horowitz asked TV content viewers about the ethical considerations of password sharing. Three in 10 consumers believe that password sharing is unethical in any circumstance, whereas almost six in 10 consumers do not see an issue with it. Among those who are okay with password sharing to some degree, over four in 10 (42%) feel it is acceptable as long as it involves sharing with their own family members, even if they do not live in the same household. A smaller percentage of consumers (16%) think that password sharing is acceptable with everyone, including individuals who are not family members.

In terms of the ethical considerations, the study found that there are nuances by age.

By far, 18-34 year-olds are much more likely than their older counterparts to password share (54%, compared to 37% among 35-49 year-olds and 17% among 50+ year-olds). They are also the least likely to have ethical concerns about it: only 13% of those 18-34 think it is unethical, compared to 24% among 35-49 and 41% of 50+ TV content viewers. Younger viewers are also more likely to believe it is OK to password share even with people who are not family members.

The full "State of Media, Entertainment, and Tech: Disruptions 2023" report tracks the evolving market for new and potentially disruptive technologies that could be game-changers, including over-the-air (OTA) antennas, wireless 5G home internet services, and piracy and password sharing. The survey was conducted in September 2023 among 1531 adults 18+ who have a role in decisions regarding TV and internet services in the home. Data have been weighted to ensure results are representative of the overall U.S. population. The report is available in total market, FOCUS Latinx, FOCUS Black, and FOCUS Asian editions.

More information is available here.  

LOS GATOS, Calif.—In its Q3 2023 earnings report, Netflix’s crackdown on password sharing helped the streaming giant increase subscribers even in the more mature and highly competitive U.S. and Canadian region where it added 1.75 million subs for a total of 77.32 million subs at the end of Q3 2023, a vast improvement over the 0.1 million subs it added a year earlier in Q3 2022.  

Globally it added 8.76 million subs for a total of 247.15 million at the end of Q3 2023. 

Netflix stock was up in early trading on October 19 as it generally outperformed financial expectations with Q3 2023 revenue hitting $8.5 billion with net income of $1.677 billion, up from 7.9 billion in revenue and 1.398 billion in net income a year earlier. Operating margins rose to about 20%.

In a letter to shareholders, the company noted that it was resuming its price hikes. “Starting today, we’re adjusting prices in the US, UK and France,” the company said. “In the US, our ads ($6.99) and our Standard plans ($15.49) will stay the same, while Basic will now be $11.99 and Premium $22.99.” That represents a $3 price hike for the Premium plan for subs who want to avoid ads and access 4K content. 

The company also reported progress in its plans to make advertising a more important part of the business. “ In Q3 ’23, our ads membership increased nearly 70% quarter-over-quarter and now accounts for ~30% of all new sign-ups in our 12 ads countries.” the shareholder letter noted. 

The company also noted that it was expecting to spend about $13 billion on content in 2023, a figure that had been reduced by ongoing strikes, and planned to spend around $17 billion in 2024.  

Although it’s been just a few weeks since Netflix rolled out its campaign to crack down on password sharing among its U.S. subscribers, early results show a significant increase in new subscriptions. 

According to researcher Antenna, May 23-27 marked Netflix’s four single largest days of new subscriptions in the U.S. since Antenna began tracking the service, with nearly 100,000 new subscribers on two of those days. 

Average daily sign-ups to Netflix reached 73,000 during the four-day period, a +102% increase from the prior 60-day average. These exceed the spikes in sign-ups Antenna observed during the initial U.S. Covid-19 lockdowns in March and April 2020. Cancels also increased during this period, but not as much as sign-ups. The ratio of sign-ups to cancels since May 23rd is up +25.6% compared to the previous 60-day period. 

In 2022, in response to a slowing rate of new subscriptions and declining revenues, the world’s largest streaming service announced that it would begin cracking down on the practice of subscribers sharing their passwords with persons outside of their immediate households. After testing its tracking methods in South America and parts of Europe, Netflix rolled out its new policy on May 23. Netflix estimates that approximately 100 million of its 232.5 million subscribers worldwide have been sharing their passwords with people outside of their households.

When confronted with the new policy, subscribers can either transfer the profile of the person outside of the immediate household in order to get that person to pay for their own subscription or the subscriber add new members outside of their household for $7.99 a month per person.

A new survey from CordCutting.com indicates that Netflix’s crackdown on password sharing may not provide the positive boost in subscribers and revenue that some on Wall Street have hoped. 

“Just 8% of these unauthorized Netflix users plan to pay for their own accounts now that Netflix has cracked down on password sharing,” the CordCutting.com survey found. While that will produce an additional 1.7 million paid users, “23% of paying users say they’d like to cancel their accounts in response to the new policies. That’s as many as 15.2 million people who could cancel their Netflix subscriptions.”

The survey also found that password sharing is a bigger problem for Netflix than any other platform except for Disney+ and that about 16% of Netflix users access accounts belonging to people outside their households.

When existing subscribers were asked how they would respond to the password crackdown, only 5% said they would pay extra for the additional users. The vast majority (70%) said they would make no changes to their account. 

"The US isn't the first location Netflix has instated these changes," the researchers wrote. "The policy was rolled out in Canada, Portugal, Spain, and New Zealand. In Spain, Netflix has received a lot of backlash, which has resulted in a loss of revenue. With the reception of US Netflix users, it's possible the change will equate to a loss in this market as well."

As Netflix rolls out its crackdown on password sharing, new research from Samba TV and HarrisX shows that among subscribers, the younger generations are more likely to cancel the service because of the new enforcement.

Last week, the world’s largest streaming service began to crack down on password sharing in the U.S., a policy that it has been promoting for almost a year. In an effort to recover billions of dollars in revenues it says it loses annually, Netflix is no longer allowing subscribers to share their passwords to access the service to anyone outside their households. When a suspected scofflaw in the U.S. now attempts to access a Netflix account outside their ISP, they get a notice directing them to subscribe to Netflix’s $7.99 ad-supported streaming tier.    

This has spurred predictable outrage on social media and a spike in “cancel Netflix” Google searches, according to BGR. Although the crackdown wasn’t the only factor—other complaints revolved around content quality and series cancellations—it was obvious that forcing subscribers to pay up for additional subscriptions has stirred a hornet’s nest (despite the seemingly illogical “spite” factor in cancelling a service just to get back at the company). 

That spite factor seems to be most predominant among Netflix’s youngest subscribers. In the survey—conducted by HarrisX in late March among 2,506 Americans—37% of current Netflix subscribers would cancel their account if they could no longer share their password with people outside their home. 52% of Gen Z and 51% of Millennials would cancel their account, but only around a quarter of Gen X and Baby Boomers would do so.

In Netflix’s favor however, data showed that of those who currently use someone else’s Netflix account, 64% would subscribe to Netflix if they could no longer use someone else’s password (39% to an ad-supported tier and 25% to an ad-free tier). 76% of Millennials and 75% of males would subscribe, compared to only 55% of females.

Other findings include:

• Account sharing has risen; a slight majority (51%) share their account with others.
• 49% of Netflix subscribers share their subscription with someone else and 48% of Disney+ subscribers share their subscription with someone else.
• Most share their account with family members in the household.
• Of those subscribed to at least one platform, 60% of those with a streaming subscription share their password with someone else. This includes 79% of Gen Z and 74% of Millennials, compared to 52% of Gen X and 38% of Baby Boomers).
• Of those who share passwords, 57% share with 1-2 people. Millennials are more likely to share with more people. Of those who share subscriptions, Millennials are the most likely generation to share with at least 3 people (34%, compared to 25% of all people who share subscriptions).
• 7 in 10 adults who share and borrow access to streaming services say that Netflix is a platform they are most likely to share with others.
• More than 4 in 10 people would be willing to pay more to share their account with someone outside of their home.
• Of those who would be willing to pay to share their account, 41% would pay up to $10 per month and an additional 10% would pay up to $15, accounting for just about half of those who would be willing to pay extra.
• Males and Millennials are most likely to be willing to pay more.
• The password crackdown may spur cancellations of the service, particularly among younger demographics like Gen Z.
• 37% of current Netflix subscribers would cancel their account if they could no longer share their password with people outside their home. 52% of Gen Z and 51% of Millennials would cancel their account, but only around a quarter of Gen X and Baby Boomers would do so.

“Data from Samba TV and HarrisX shows the crackdown on password sharing has the potential to hasten the growth of Netflix’s ad-supported tier as sharers are gently forced to migrate to their own accounts," said Samba TV CEO Ashwin Navin. "Of those who currently use someone else’s Netflix account, almost 40% say they’d move toward the cheaper monthly subscription with ads, while only a quarter may sign up for their own ad-free experience.”

“There's also an opportunity for Netflix to charge for these additional users. 4 in 10 subscribers say they’d pay up to an additional $10 per month to share their account with someone outside of their home. Implementing this new fee could quickly grow Netflix’s subscriber revenue.”

“Most subscriber losses due to password sharing are likely to come from younger generations. Our research indicates more than half of Gen Z and Millennial subscribers are likely to cancel their accounts if they are no longer allowed to share passwords. This is roughly double the percentage of Gen X and Boomer subscribers who say they’d do the same.”

LOS GATOS, Calif.—Netflix has officially launched its long-awaited crackdown on password sharing in the U.S. with an email to Netflix subscribers who are sharing Netflix outside their household. 

The email reminds them that a “Netflix account is for use by one household” and explains that they can add a user outside the household for $7.99 a month. 

As previously reported in TVT, Citi analyst Jason Bazinet estimated in 2021 that password sharing could be costing Netflix upwards of $6 billion in annual revenue and in 2022, Netflix suggested that as many as 100 million households around the world were accessing the streaming service with a shared password. 

Earlier this year, Netflix unveiled its plans to crackdown on account sharing with many expecting the crackdown to come as early as March. 

“Everyone living in that household can use Netflix wherever they are — at home, on the go, on holiday — and take advantage of new features like Transfer Profile and Manage Access and Devices,” Netflix explained in a blog post on May 23 that described steps subscribers can take to control access to their account. “We recognize that our members have many entertainment choices. It’s why we continue to invest heavily in a wide variety of new films and TV shows — so whatever your taste, mood or language and whoever you’re watching with, there’s always something satisfying to watch on Netflix.” 

Netflix has previously tested cracking down on password sharing in some Latin American markets. 

It remains uncertain however if the crackdown will boost Netflix subs in the heavily saturated U.S. market. Five years ago, Netflix believed that password sharing helped build buzz for its original programs by exposing them to larger audiences and refused to crackdown on the practice. 

DALLAS—Anyone wondering how much password sharing and other forms of piracy are costing the U.S. streaming industry now has an answer from Parks Associates. The research firm is reporting that by the end of 2027, there will be a cumulative loss to piracy of $113 billion for streaming video providers serving U.S. consumers. 

While large streamers like Netflix are working to cut down password sharing, the international research firm's latest forecast also indicates that the problem is getting worse, not better. 

It predicts that piracy rates for U.S. streaming services in film and television programming are expected to rise from 22% in 2022 to 24.5% in 2027 and that the value of fraudulent advertising delivered online to media and entertainment consumers may exceed $700 million in 2027.

The Parks Associates research also shows that visits to pirate hosting websites increased by 31% in 2020 and industry leaders are responding with new anti-piracy policies in the hopes of stemming revenue losses.

The new study "Streaming Piracy Market & Ecosystem Strategies" provides a comprehensive view of piracy threats and the evolution of anti-piracy techniques along with five-year forecasts of revenue loss in the US market for video service providers. 

"While there is some optimism that emerging countermeasures and best-practices may see piracy begin to plateau by 2027, there is no consensus among stakeholders as to when it may begin to decline," said Steve Hawley, contributing analyst, Parks Associates, and managing director of the Piracy Monitor industry newsletter and consultancy. "This research provides a much-needed understanding of the issues at hand and the technologies and approaches available to fight piracy."

Parks Associates' research indicates that video service providers may reduce the motivation for password sharing by restricting the number of users who can stream the service simultaneously. In addition, Netflix is introducing a feature that will allow users to share accounts for an extra fee, and Adobe launched "Prime Account IQ" to help providers identify when viewers are sharing credentials.

"The number of households who share account credentials and consume pirated content is rising. People are increasingly looking for new ways to satisfy entertainment needs," said Sarah Lee, research analyst, Parks Associates, and contributor to the report. "Participation in sharing account credentials increased 48% since 2019."

A new survey of U.S. consumers by Reviews.org provides some good news for pioneering services like Netflix while highlighting some serious problems for the overall industry regarding subscription fatigue, password sharing and fickle subscribers who are cancelling subscriptions at alarming rates.  

On the positive side, some pioneering streaming services continue to maintain consumer interest despite growing streaming subscription fatigue. About 43% of U.S. consumers named Netflix as the service they would choose if they could only have one service, more than double those choosing Prime Video (17%), Hulu (16%), Peacock (8%), HBO Max (7%), and Paramount+ (5%). 

As streaming choices over the past 2 years have exploded, the survey also found that consumers are overwhelmed with choice – and not just from the amount of content itself, but the amount of streaming subscriptions to choose from. 

That helped convince 39% to cancel a service in the last six months and 55% to subscribe to a new service. Top reasons for canceling were cutting back on monthly expenses (44%), followed by not watching enough (37%), using a different streaming service more often (9%) and favorite shows no longer available (6%). 

While Netflix was the most valued service, it was also the most canceled, with 21% reporting that they had dropped their subscription in the last six months. Hulu was the second most dropped (20%), followed by Peacock (14%) and HBO Max (13%). 

Password sharing also remains rampant, with nearly two in four reporting that they shared a login. 

The complete report is available here. 

DURHAM, N.H.—New consumer research from Leichtman Research Group (LRG) finds that 86% of U.S. households have at least one streaming video service from fifteen top subscription video on-Demand and direct-to-consumer (DTC) services, and that 50% of households have four or more DTC streaming video services.  

But as these services become nearly ubiquitous in U.S. homes, password sharing remains a serious problem for streaming services. The study found that: 

• 68% of all DTC services are fully paid for and are not shared with others outside the  household.
• 27% of all DTC services are used in more than one household.
• 13% of DTC services are used and paid for by those that also share them with  someone outside the household.
• 12% of DTC services are used in one household but are borrowed from another  household that is paying for the service. 
• 2% of DTC services are used by multiple households that share costs.
• 5% of DTC services are not paid for because they come with another service 

“About six out of every seven households now have a streaming video service, and half of all  households have four or more streaming services. Yet, many of these services are being  shared,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group,  Inc. “Over one-quarter of all DTC services are shared with others outside the household, including 12% of all DTC services that are ‘borrowed’ from someone else’s subscription. Overall, 17% of households have at least one DTC service that is fully paid for by someone else.” 

Other key findings include:  

• Among all ages 18-44, the mean number of DTC streaming services is 4.8 – compared to 4.0 among ages 45-54, and 2.5 among ages 55+.
• Among ages 18-34, 17% of all DTC services are fully paid for by someone else – compared to 8% among ages 35+.
• Ages 18-34 account for 55% of all DTC services that are fully paid for by someone else. 
• 14% with Netflix have the service fully paid for by someone else – compared to 13%  with HBO Max, and 12% with Hulu. 
• Adults ages 18-44 account for 59% of all with a vMVPD pay-TV service. 
• 73% of vMVPD subscribers are very satisfied with their service – compared to 77%  in 2021, and 69% in 2018.
• 22% of all vMVPD services are shared by multiple households, including 8% of all  vMVPD services that are fully paid for by someone outside the household. 

These findings are based on an online survey of 3,501 households from throughout the United  States and are part of a new LRG study, Internet-Delivered TV Services 2023. This is LRG’s  sixth annual study focused on the vMVPD category, along with other DTC streaming video  services. 

A new survey on streaming services from Forbes Home says that 47% of respondents pay for streaming services they don’t use. The survey also found that 35% will cancel Netflix if it continues to raise prices or crack down on password sharing.

The survey of 1,000 Americans found that the average consumer subscribes to 2.8 streaming services and that 10% pay for more than five streaming services simultaneously. Millennials and Gen X are the most likely to subscribe with Baby Boomers the least. 

Netflix was found to be the most popular streaming service with 52% of respondents subscribing. Other streaming services were far behind with Amazon Prime garnering 10%, and HBO Max, Apple TV and YouTube TV at 7% (Hulu didn’t make the list).

The Forbes Home survey concluded that the 35% of respondents that said they would cancel Netflix over higher prices or password sharing crackdown could translate into a loss of approximately 80 million subscribers. About 25% of respondents to the survey said they would cancel any streaming subscription if other services followed suit. 

The survey illustrated the ongoing fickleness of consumers with 57% of subscribers signing up with a service to watch just one show, with more than half considering the opportunity to binge watch one show worth the price. A small fraction—4%—ever review how much they’re spending on streaming services and half of respondents said they forgot to cancel a service after the offer of a free limited time subscription expired.

Netflix has released details about its new rules on password sharing. The company has been planning on cracking down on the practice for more than two years but confirmed its commitment to do so last year. 

The plan was one of several Initiatives the company took to improve its bottom line and attract more subscribers (including a low-cost ad-supported tier launched in November) after reporting declining revenues and subscriptions a year ago. 

In a report issued in 2021, Citi analyst Jason Bazinet estimated that password sharing could be costing Netflix upwards of $6 billion in annual revenue.

The new password regime has been tested in several Latin American countries for the past several months. Earlier this month, the  company notified investors that it expected to roll out the new rules to take effect in the U.S.  by the end of Q1—the end of March at the latest.  

In an FAQ on its website, Netflix said that each household will need its own separate account and that when a device outside of the household logs into the account (“or is used persistently”), it could prompt the viewer to verify the device by using  IP addresses, device IDs, and account activity from devices signed into the Netflix account.

“As long as the device being used to watch Netflix is using the internet connection in the primary account owner's household, we will not require verification,” the company said..

Netflix will verify the account by sending a link to the email address of the phone number associated with the primary account owner; the link will provide a 4-digit verification code which will need to be entered on the device being verified within 15 minutes. Such verification may be required periodically, 

Netflix is so confident that the device verification process will work that it added that it doesn’t expect primary account holders to be charged extra if a password is shared on an unverified device. “Netflix will not automatically charge you if you share your account with someone who doesn’t live with you,” it said.

Netflix says it won’t require device verification for subscribers (or members of their households) who are travelling or live between several homes, however it may require device verification if the subscriber is out of the main household “for an extended period of time.”

Netflix currently offers four tiers per household:Basic and Basic with Ads, which allow for viewing on one supported device, Standard, which allows for 2, and Premium which now allows for viewing on six supported devices (announced today).

A year ago, a survey from LRG revealed that a third of all Netflix subscribers share their passwords to someone outside of their household. 

As major streaming services scramble to improve their profits and eye crackdowns on password sharing, a new survey from Horowitz Research suggests that Netflix’s efforts to prevent users from password sharing may not spell doom and gloom for the service. 

Horowitz’s latest State of OTA 2022 report, released late in 2022, found that 7 out of 10 Netflix users who password share would be willing to pay full price for the service if they could no longer share access.

In an earlier 2022 study (State of Viewing & Streaming 2022), Horowitz found that the average streamer uses 7.1 streaming services in a typical month—4.3 of which are subscription services. The average streamer now pays $75.8 a month for their streaming services, up from $49.3 reported in 2021, according to the firm’s State of Pay TV, OTT, and SVOD 2022 study.

With so many subscription streaming services (SVODs) now available and consumers struggling to handle rising subscription costs, the new Horowitz State of OTA 2022 report confirms that SVOD users are increasingly engaging in the practice of sharing passwords with others in order to offset costs. 

The survey found that there is some degree of log-in/cost sharing across all the subscription streaming services tested in the latest survey. 

For example, 18% of TV content viewers share access to Netflix while 42% pay for the service themselves; 15% share access to Amazon Prime Video with 44% paying for the service themselves, Horowitz reported. 

This translates to about 1 in 3 Netflix users and 1 in 4 Amazon Prime Video users sharing access to those services. The numbers are similar among users of other popular services such as Hulu, Disney+, and Paramount+.

Notably, the study shows that the lower the penetration of the service, the more likely it is that users are sharing passwords. For example, 11% of consumers surveyed have Showtime Now, and a full 60% of Showtime Now subscribers share their passwords, as do 51% of Britbox and 47% of Starz users.

How crackdowns on password sharing might impact subscriber counts has been a hotly debated topic in the media industry. 

The new Horowitz study provides some important insights and answers to that question. 

The survey found that the more valuable the service is perceived to be, the less likely it is that consumers will share their passwords. 

For example, 83% of Netflix users and 81% of Amazon Prime Video users think the respective services offer excellent value for the money, compared to 63% of Showtime Now users and 60% of Britbox users who feel that way about those services.

“Netflix and Amazon Prime Video have long proven their value for the money to their subscribers, Netflix because of its extensive library of both syndicated and original content, and APV with its tie-in to other Amazon Prime benefits,” explained Adriana Waterston, chief revenue officer and insights and strategy lead for Horowitz Research. “As such, while Netflix’s crackdown on password sharing will likely lead to subscriber loss, the majority of subscribers will stay with the service. However, Netflix will need to keep its perceived value high in order for consumers to continue to justify the investment. This will certainly be a challenge for Netflix moving forward as their programming costs continue to increase and as they add commercials. Also, other services considering a similar crackdown will need to justify this move by finding ways to add value to their services, making them stickier for consumers.”

The full State of OTA 2022 report tracks the evolving market for new and potentially disruptive technologies that could be game-changers, including over-the-air (OTA) antennas, wireless 5G home internet services, and piracy and password sharing. 

The survey was published in November 2022 among 1,600 adults, with an oversample that resulted in 855 antenna owners. Data have been weighted to ensure results are representative of the overall TV universe. The report is available in total market, FOCUS Latinx, FOCUS Black, and FOCUS Asian editions.

More information is available here. 

As Netflix continues to warn its subscribers of its impending campaign to crack down on password sharing, the streaming giant rolled out a new feature this week that it says gives its subscribers more “control” during this “busy holiday season.”

In response to declining subscriptions and revenues, Netflix is lowering the boom on subscribers who they believe abuse the privilege of a paid subscription by sharing their password indiscriminately. For much of 2022, it has been conducting trials that previewed these features in Latin America, in which, for example, it would allow—for a fee oftentimes lower than a full membership—subscribers to share accounts with people outside their households. 

In October, it launched “Profile Transfer,” a feature that lets viewers sharing a Netflix account transfer their profile—which includes personalized recommendations, viewing history, My List, saved games, and other settings—when they start their own membership, something Netflix described as “one of its most requested features.” And earlier this month, it launched its much ballyhooed $6.99 ad-supported tier. 

The new “Managing Access and Devices,” announced Tuesday allows subscribers to view recent devices that have streamed from their account and to log out of specific devices “with just one click.” Netflix said this ability was also a popular request. 

“This much-requested feature to help members manage their account security is now available to all members around the world on the web, iOS and Android,” Netflix said in a blog post. 

Netlfix this week announced the addition of a “Profile Transfer” feature that lets viewers sharing a Netflix account transfer their profile, which includes personalized recommendations, viewing history, My List, saved games, and other settings—when they start their own membership, a harbinger of things to come as the streaming giant takes steps to prevent subscribers from sharing passwords with friends and family, which Netflix says has caused the company to lose revenues for years. 

“People move. Families grow. Relationships end. But throughout these life changes, your Netflix experience should stay the same,” said Timi Kosztin, product manager. 

The new, "much requested" feature (according to Netflix) is now available worldwide. Subscribers will be notified by email as soon as Profile Transfer becomes available on their account. The feature can be turned off in the subscribers account settings at anytime, Netflix said.  

Neflix hopes that subscribers will get used to the new feature over time as the company prepares to crack down on password sharing. The company is currently testing methods in Latin America. The feature rollout is part 2 of its multi-pronged effort to boost revenues after the announcement of its launch of a $6.99/month, ad-based service last week. 

“No matter what’s going on, let your Netflix profile be a constant in a life full of changes so you can sit back, relax and continue watching right from where you left off,” the company said.

Netflix is adding millions more subscribers to its initial test of password-sharing options. The streaming giant is rolling out the new fees to battle the scourge of households worldwide that are using accounts covered by other subscribers. In March, when it announced its plans, the company claimed that more than 30 million households are sharing passwords, blaming the practice for slow subscriber and revenue growth now and for the near future. 

In May, it rolled out its “add extra member” plan to subscribers in Chile, Costa Rica and Peru but the test resulted in confused subscribers who, among other problems, had difficulty deciphering the definition of “household” or understanding what options they were eligible for. 

In the latest expansion, Netflix is adding Argentina, the Dominican Republic, El Salvador, Guatemala, and Honduras. Subscribers in these countries will be offered an “add a home” feature.  

New subscribers will be allowed one Netflix account—whatever subscription—to watch the service on any device, For an additional $2.99 per month (219 pesos in Argentina), subscribers can watch in additional homes with Basic members being allowed to add one extra home, Standard up to two extra and Premium up to three extra. 

Subscribers will be able to watch Netflix out of home but just on laptops, tablets or smartphone. An additional feature that allows subscribers to control where their account is being used—and remove homes at any time from their account settings page—will added soon.

In a blog post, Chengyi Long, director of product innovation for Netflix said “We value our members, and recognize that they have many entertainment choices. So we’re working hard to make great TV shows and films, and to be as thoughtful as possible about how we charge for use across multiple homes. We will not make changes in other countries until we better understand what’s easiest for our members.”

NEW YORK—As Netflix prepares to crackdown on people who are sharing password credentials to access to the streaming services, a new survey from Kagan, the media research unit of S&P Global Market Intelligence, offers a detailed profile of this group. 

Netflix, which has seen its stock hammered this year by disappointing subscriber numbers, reported in its Q1 2022 earnings call that upwards of 100 million households worldwide, including 30 million in the U.S. and Canada, are using a shared password to access the streaming service for free. 

The new Kagan survey provides some answers as to who those people are as well as some insights as to how likely they would be to start paying for the services. 

Overall U.S. password sharers have less household income and use fewer subscription video-on-demand services on average, compared to long-term subscribers, according to data from Kagan's U.S. online consumer survey, conducted in March 2022.

Brian Bacon, research analyst and author of the Kagan report concluded that while “Netflix intends to crack down on password sharing” turning the password sharers into paid subs “will be difficult since shared log-in users tend to have less disposable income and are less engaged in online video, especially when compared to recent subscribers."

Other key findings of the report include: 

• Shared log-in users on Netflix tended to be younger, with Gen Z at 25% compared to 10% of long-term subscribers. Recent subscribers to Netflix also tended to be younger than long-term subs, with Gen Z at 28% and millennials at 36% of subscribers surveyed who indicated they established a subscription in the past 12 months.
• Households without children represented a larger share of shared log-in users, at 28% for single and 46% for multiple adult households, compared to long-term subscribers, at 24% and 41, respectively. Households of single adults, both with and without children, represented larger shares of recent subscribers, at 38% and 17%, respectively, compared to 24% and 7% of long-term subscribers
• Shared log-in users also skewed more toward less educated and lower-income households, with 36% holding a high school diploma or less and 43% earning less than $50,000 per year, compared to 23% and 30% for long-term subscribers, respectively.
• Including Netflix, total service users surveyed used an average of five SVOD services. Amazon.com Inc.'s Prime Video, Walt Disney Co.'s Hulu and Disney+ were the most likely to be used at 66%, 53% and 47%, respectively.
• Netflix users who receive the service as a subscriber perk were the least likely of the Netflix user segments to indicate using several of these popular SVOD services, with Hulu at 43%, Disney+ at 27% and AT&T Inc.'s HBO Max at 25%. Most shared log-in users (84%) frequently stream video from SVOD services (at least once per week) although are less likely than recent and long-term subscribers at 90% and 91%, respectively.
• Recent subscribers to Netflix were the most likely to indicate they use a traditional multichannel service in their household at 74%, while those who share a log-in were the least likely at 51%. 

 Full results are available at Netflix user profile 2022: Who is (and isn't) using a shared log-in.

LOS GATOS, Calif.—Faced with worries about ongoing subscriber losses that have hammered its stock price, Netflix is preparing to crack down on password sharing and to launch a new less expensive tier with ads in the last quarter of 2022, the New York Times has reported, citing anonymous Netflix employees. 

The move comes as the streaming company is under increased pressure from shareholders who have seen the value of the stock plunge 70% in the last year. 

That reporting indicates Netflix maybe moving much faster towards embracing advertising as part of its business model, something the company has staunchly resisted throughout its history. It was only in the most recent Q1 earnings call, when the company reported its first sub loses in years, that Reed Hastings, Netflix’s co-founder, chairman and co-CEO reversed course, 

During the Q1 2022 earnings call Hastings raised the idea of ad-supported plans saying, “those who have followed Netflix know that I've been against the complexity of advertising and a big fan of the simplicity of subscription. But as much as I'm a fan of that, I'm a bigger fan of consumer choice. And allowing consumers who would like to have a lower price and are advertising-tolerant get what they want makes a lot of sense. So that's something we're looking at now. We're trying to figure [it] out over the next year or two. But think of us as quite open to offering even lower prices with advertising as a consumer choice.”

“I think it's pretty clear that it's working for Hulu,” Hastings added later in the call. “Disney is doing it. HBO did it. I don't think we have a lot of doubt that it works, that all those companies have figured it out. I'm sure we'll just get in and figure it out as opposed to test it and maybe do it or not do it. So I think we'll really get in. But again, it would be a plan layer, like it is at Hulu. So if you still want the ad-free option, you'll be able to have that as a consumer. And if you would rather pay a lower price and you're ad-tolerant, that's also -- we're going to cater to you also.”

Those initial comments indicated the new tier or tiers with advertising could be a year or two away, reflecting the difficulty of building an advertising business from scratch.

But the rapid decline of Netflix share prices, increased competition from other streamers and the prospect that it will report up to 2 million more sub losses in the months to come, seems to have pushed the company into a much faster time-table. 

DURHAM—A third of all Netflix subscribers share their passwords with non-subscribers, according to a new report from Leichtman Research Group, which also revealed that 64% of Netflix subscribers stay honest, paying fully for the service and not sharing outside of their household. 

Specifically, the report showed that 15% of Netflix services are used and paid for by those that also share them with someone outside the household;  5% of Netflix services are used in one household but are borrowed from another household that is paying for the service and  3% of services are used by multiple households that share costs. An additional 3% of Netflix services are not paid for because they come with another service.

The findings are based on an online survey of 4,400 households nationwide and are part of a new LRG study, Internet-Delivered Pay-TV Services 2022.  This is LRG’s fifth annual study focused on the vMVPD category, along with other DTC streaming video services.

Overall, LRG found that 83% of U.S. households have at least one streaming video service from 15 top direct-to-consumer (DTC) and subscription video on-Demand (SVOD) services; including 67% of all households with Netflix. 

The survey revealed that 29% of all DTC services are shared with others outside the household and that 12% of all DTC services are fully paid for by someone outside the household. In addition, 34% of adults ages 18-34 have at least one DTC service that is fully paid for by someone else—compared to 14% of ages 35+.

Five percent of all households had Netflix in the past year, but currently do not— similar to 6% for Hulu, 5% for Amazon Prime, and 5% for live pay-TV services. Adults ages 18-44 account for 65% of all with a vMVPD pay-TV service. 

When it looked at vMVPDs, (YouTube TV, Hulu, Sling TV, etc.) the survey showed that nearly 80% of vMVPD subscribers said they are very satisfied with their service—compared to 76% in 2020, and 69% in 2018. Password sharing was also fairly common among these subscribers as well, with 23% of all vMVPD services shared by multiple households, including 7% of all vMVPD services that are fully paid for by someone outside the household.

The report comes amid a slowdown in the rate of subscriptions for the world’s largest streamer and provides more fodder for Netflix to justify its recent attempts to crack down on password sharing, which, if followed through, could add an estimated $1.6 billion to its bottom line annually.

“Password sharing is an inherent feature of most streaming services. Sharing helps to expand the user base and retain customers, but it also creates a gap between the number of households that have a service and actual paying subscribers,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc.  “For example, about two-thirds of U.S. households report having Netflix, but this includes about 10% of U.S. households that don’t pay for the service because it is borrowed from someone else’s subscription.”

DURHAM, N.H.—The sharing of streaming services is a hot-topic in the industry right now, and Leichtman Research Group is the latest to share details on consumer behavior regarding the trend. According to LRG’s recent study, 27% of the top 11 direct-to-consumer and streaming accounts are being used in more than one household.

LRG’s study found that 82% of U.S. households have at least one streaming service, with 51% of them having three or more. While 69% are fully paid and are not shared with anyone outside the household, 27% of them are (the other 4% represent DTC services that come with another service).

The 27% breaks down like his: 13% of services are used and paid for by those that also share them with someone outside the household; 12% are used in one household but are borrowed from another household that is paying for the service; and 2% of services are used by multiple households with them sharing costs. Overall, 16% of all households have at least one DTC service that is fully paid for by someone else.

The younger age group (18-34) is the most likely to use a DTC service someone else pays for, with 26% reporting that they do. For those over 35, only 12% say they use a service that they do not pay for.

PLUS: Report: 88 Million Streaming Accounts Being Shared

“Password sharing is prevalent throughout the streaming video industry. Over a quarter of DTC streaming video services are shared with others outside the household, including 12% of all services that are ‘borrowed’ from someone else’s subscription,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc. “Yet, sharing of streaming services should not solely be viewed as lost revenue, as the ability to share with others is also part of the retention strategy for the services.”

LRG also looked at vMVPDs in its report, finding that 63% of 18-44 year olds have a vMVPD pay-TV service. Consumer satisfaction with these services is up, with the 77% reporting to be very satisfied, compared to 69% in 2018. In addition, just 13% are likely to switch from a vMVPD service in the next six months; that was at 27% in 2018.

There are still sharing issues with vMVPDs. LRG found that 20% of all vMVPD services are shared by multiple households, including 6% that are paid fully by someone outside of the household.

For more information, visit www.leichtmanresearch.com.  

NEW YORK—There was a strong growth for streaming among U.S. adults in 2020, but not all of those gains came from new subscribers, as the practice of password sharing has led to a total of 88 million “borrowed” accounts, according to a new study from CordCutting.com.

In its “Subscription Mooching: 2021 Annual Report,” CordCutting.com noted an increase of nearly 50 million U.S. adults saying that they watch streaming—168 million in 2020, 214 million as of this latest report. That represents more than 80% of people over the age of 18. However, with 88 million accounts being shared, the study estimates that streaming platforms are missing out on more than $4 billion in subscription fees, up from $2.6 billion in 2020.

The report says that only about 60% of people are paying for their own streaming subscription, but it varies depending on the platform. Amazon Prime Video has the largest percentage of users that subscribe on their own (72%), actually up from 2020 (69%). Disney+ is the lowest at 52%, but that is also up from 2020 (50%). In fact, all of the streaming platforms including in the report, except Hulu, saw an increase in the percentage of people that paid for their own subscription (HBO Max did not have data for 2020).

As far as percentage of people sharing streaming passwords outside of their own home, nearly all of the streaming services are less than 20%, with Disney+ being the lone exception right at the 20% mark; it was also the only service (not including HBO Max) to increase year-over-year as well. Netflix, Hulu and Amazon Prime Video have all seen decreases in what CordCutting.com calls “moochers” over the last three years, with the percentage in the latest report at 13%, 11% and 5%, respectively.

If the moochers and borrowers were forced to pay for a streaming service, a healthy portion of them would. At least 30% of respondents said that they would pay for one of the five streaming services included in the survey, with Netflix and Disney+ the most popular (43% and 42%).

This helped CordCutting.com come up with the estimate for lost revenue from borrowed accounts. It estimated that Netflix is losing the most money at $1.8 billion; HBO Max entered the equation losing about $1 billion in lost revenue; and Disney+ doubled year-over-year to $880 million. This all contributed to the rise of more than $4 billion in lost revenue among the five services.

Some streamers are now taking action to try and prevent password sharing, including Netflix, which has tested password verification.

The full report is available on CordCutting.com. 

NEW YORK—The cost of password sharing for Netflix is an estimated $6 billion per year, according to Citi equity analyst Jason Bazinet. That is about a quarter of what Netflix made in the last fiscal year.

The habit of sharing online passwords to streaming and other subscription video-on-demand services amounts to about $25 billion in lost revenue, Bazinet reports. Netflix accounts for about 25%. 

Bank of America shared a note on March 12 that suggested a “substantial percentage” of streaming subscribers share their passwords with friends, family and others outside their home.

Netflix is the most popular, but Citi expects that the newer streaming services like Disney+, HBO Max, Peacock, Paramount+ and others could see a similar impact in the future.

“As streaming services move to center stage, thwarting this theft will be of growing importance for shareholders,” said Bazinet.

Netflix is taking steps to potentially address the issue of password sharing. It recently began a test for a new feature that requires users to provide an extra step of authentication via a code sent to the primary phone number or email associated with an account. 

LOS GATOS—The days of mooching off a parent’s or a friend’s Netflix account may be coming to an end. Multiple outlets have reported on a new feature that some Netflix viewers have run into this week that is an attempt to crack down on password sharing for the streaming service.

Netflix confirmed the new feature is being tested to The Hollywood Reporter.

Currently used in limited cases, when a viewer attempts to use another person’s account they are being prompted with a message that says, “If you don’t live with the owner of this account, you need your own account to keep watching.”

Viewers are then given the option to verify their identity with a text or email with a code sent to the account’s owner, or they can choose to “verify later,” allowing them to continue watching and later confirm they are a valid account user. If they are not able to verify, Netflix then provides the option to create a new account with a 30-day free trial.

A Netflix spokesperson has said, “This test is designed to help ensure that people using Netflix accounts are authorized to do so.”

Password sharing has been a common practice with streaming services. According to a report by Hub Entertainment Research from 2020, 31% of consumers have shared account passwords with people not in their house. The report also reported that Netflix was the service that had the most password sharing.

There is no information as to if or when this feature could become permanent for Netflix.

DALLAS—Pay-TV and OTT operators in the U.S. took a hit of $9.1 billion in 2019 due to consumers sharing accounts and pirating content, according to a report from Parks Associates. Looking forward, Parks says that it expects the value of pirate video services to exceed $67 billion worldwide by 2023.

A 2019 Parks Associates report detailed U.S. operators’ $9.1 billion loss revenue in 2019, about which $2.5 billion was lost directly because of pirating; across North America, pirating generated $8.4 billion in losses. Pirating methods that Parks highlighted in its report include theft of video content from production, from distribution, from jail-broken consumer devices and from hosting by other pirates.

However, Parks found that the most antipiracy efforts in the U.S. focus on detecting and reducing credential sharing and account abuse. A Parks survey of U.S. broadband homes found 5% used someone else’s credentials to access a pay-TV service, while 6% did so to access an online video service. Another report from Hub detailed how prevalent password sharing is, particularly among teens and young adults, 80% of which have said they have shared or have used a shared password for streaming services.

“Credential sharing falls into two categories,” said Steven Hawley, contributing analyst at Parks Associates. “Most sharing is casual, with no intent to profit. But the bigger risk is from pirates that purchase large stolen consumer databases via the ‘Dark Web’ and use automation to discover penetrable end user accounts.”

Overall, Parks says that 12.5 million pay-TV households accessed pirated video in the U.S. in 2019, but that number is still low compared to the Asia and Pacific region.

The full “Video Piracy: Ecosystem, Risks and Impact” report is available online.

BOSTON—Some of the subscription figures that streaming services have may not show the whole picture of who all is watching their content, as password sharing with non-subscribers has become an increased worry, especially among the younger generation.

In its “Video Redefined” study, Hub has determined that password sharing is a particular problem among 13-24 year olds, with 81% having given or used someone else’s password. For 35-74 year olds that percentage drops to 29%, but still is nearly one in every three adults.

In terms of sharing passwords with someone not in the house, about 31% of all consumers confessed to doing it (64% 13-24 year olds, 16% of 35 and older). For the teens and young adults, Netflix is the most popular service to share at 56%, while Disney+, which launched in November 2019, is second at 31%; Hulu (30%), Apple TV+ (17%) and Amazon (14%) follow.

Even more consumers are likely to use a password for a service that they do not subscribe to—42% across all ages (78% 13-24 and 24% 35 and older). Netflix is still the most popular streaming service to access (69%), followed by Hulu (59%), Amazon (53%), Disney+ (53%), HBO Now (45%) and Apple TV+ (42%).

Viewers will often continue to use the shared password frequently. For 13-24 year olds, 77% will access Netflix at least every week; Hulu 73%, Disney+ 73% and Amazon 68%.

“Online streaming platforms must love it when one of their original shows generates massive buzz. After all, what better way to attract new subscribers than by offering hugely popular shows you can’t watch anywhere else?” said Peter Fondulas, principal at Hub and the study’s co-author. “But when popularity and exclusivity are combined with often ambiguous, even sometimes nonexistent, rules about legitimate use, it’s almost an invitation to subscribers to share the enjoyment with friends and family. Wall Street has already made its displeasure clear, but in spite of that, password sharing is still very much alive and well.”

More information is available on Hub’s website.