In five Latin American nations, Netflix Inc. will charge subscribers a fee to use their account in a second residence. The business is conducting this test in the hopes that charging subscribers to share their Netflix account will result in increased revenue.
Customers using an account for more than two weeks away from their home address in Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic will be charged an additional cost, the business announced in a blog post on Monday. Both persons on vacation and those using mobile devices like cellphones, tablets, or laptops to access Netflix won’t be impacted by this. In Argentina, the additional home will cost 219 pesos ($1.70), while it would cost $2.99 elsewhere.
According to Netflix, more than 100 million households are utilising accounts that have been paid for by other people. Password sharing is one of the main causes of the company’s sluggish subscriber growth, according to Netflix. The business lost 200,000 consumers in the first quarter and is projected to lose 2,000,000 more in the next. Investors’ concerns that the streaming industry is in peril have caused its share price to decline by more than 65% this year.
“today’s extensive account sharing between households hinders our long-term ability to invest in and develop our service.”
In Latin America, where Netflix is doing its first two tests to see if subscribers will pay for access, password sharing has been especially prevalent. Without hurting Netflix subscribers or alienating users, the corporation is attempting to restrict sharing. Some consumers are concerned they will lose access to their accounts because the effort has occasionally been presented as a crackdown.
The business is experimenting with ways to charge more if multiple people use the same Netflix account. In its initial attempt, the business requested extra payment from clients in Chile, Costa Rica, and Peru in order to add a member to an account. This additional user creates a sub-account with their own email address, receives their own stream, and is permitted to use Netflix concurrently with the primary user up to the allotted time on their plan.
Customers can view on one device at a time with a basic package. The premium package supports four devices, while the more expensive regular plan supports just two.
Customers who are utilising the same account in different residences are the focus of this most recent test. They will get an in-app notification asking them to either add a household or shift their primary household to the new location if they use an account outside of one of their paying households for more than two weeks.
Customers have control over their properties and can add or remove them as they see fit. There is no rise in the number of simultaneous Netflix viewers when additional households are added.