If you’re using someone else’s Netflix account, this news is for you: Netflix wants to generate revenue from sharing and wants to do so soon.
In a letter to shareholders as part of the first quarter’s revenue results, Netflix for the first time put a figure on the total number of households using another household’s account, essentially saying that more than 100 million households are currently connecting to Bridgeton using someone else’s credentials and does not pay Netflix for the service.
The company currently has more than 221 million paying subscribers worldwide, but that number is almost unchanged from the last quarter. According to Netflix, there are approximately 33% more people who could also pay to watch the next Squid game.
It’s no secret that the popular streaming service now caters to people who share accounts. Earlier this year, he unveiled a pilot program that will add an additional fee of $ 2.99 to accounts that want to share their credentials outside the household. So far, the test is available in Chile, Costa Rica and Peru.
However, based on the wording of the letter, it is now clear that Netflix can move quickly to expand the program. In the letter, Netflix explained: “So while we won’t be able to make money from all this right now, we believe it’s a great short-term to medium-term opportunity. As we work to generate revenue from sharing, ARM growth, revenue and viewing, it will become a more important indicator of our success than membership growth. “
Netflix’s growth struggles are actually divided into a number of factors that Netflix notes it cannot control, such as how many people buy connected or smart TVs, people who switch (or not) from cable and broadcast to on-demand services (such as Netflix) and rising data costs. It is worth noting that Netflix, which does not control broadband costs but manages its own service prices, has been raising prices in recent years, including a significant increase in January.
Despite the significant number of people sharing Netflix (100 million worldwide and 30 million in the United States and Canada), Netflix notes that the number of shareholders has remained relatively static in recent years. However, this makes Netflix no less concerned about using this potential revenue.
It’s also clear that as the world returns to life outside of our COVID bubbles, Netflix is experiencing a kind of rapid growth and decline. It was fast in 2020, but withdrew significantly in 2021, and the slowdown only accelerated due to factors that Netflix can’t control, and those tens of millions of non-paying account partners.
What does this mean for you?
If you’re one of the millions of people who share accounts with your parents, perhaps friends or distant relatives, Netflix warns you. There probably won’t be a global fee for sharing accounts today, tomorrow or next week, but it’s definitely coming. One day you may get a call from a friend: “Hey, about my Netflix account …”
- If you want to understand why Netflix solutions are just the beginning of a slippery slope for account sharing, read this.
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