Netflix has been making some changes lately to deal with its streaming struggles.
With services like Disney+, Hulu, and HBO Max to compete with, Netflix has had to adjust to try to stay ahead of the game. Last year, the company laid off hundreds of employees, created ad-supported membership tiers, and put into motion a plan to start charging for password sharing. The company has already started to roll out the password-sharing crackdown in international markets, but it looks like US streamers might have a bit more time to take advantage of their friends’ accounts before Netflix takes this perk away.
According to CNBC, Netflix modified the timeline for its password-sharing plan, which was discussed in the earnings release this week. Originally, the company planned on charging for password sharing by the end of the first quarter of 2023, but that has now been delayed to the second quarter.
The company stated that “while this means that some of the expected membership growth and revenue benefit will fall in Q3 rather than Q2, we believe this will result in a better outcome from both our members and our business.” Netflix has shared that this type of initiative has done well for them in international markets — while initially it was met with cancellations, eventually it led to more subscribers and revenue.
In these instances, password-borrowers would eventually sign up for their own accounts as well as add “extra member” accounts, which boosted revenue. And it seems Netflix is hoping a similar outcome will happen with this Q2 rollout, and (thanks in part to that) will still be spending quite a bit on new content. Netflix plans to spend around $17 billion on 2024 content.
So, it looks like this crackdown is still happening, it is just getting pushed back a bit. We’ll continue to keep our eye on the situation, so stay tuned to DFB for more!
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