In January, Netflix announced their intentions to put a stop to account sharing in an attempt to stay competitive with the likes of Amazon Prime and Disney Plus. Now, it seems that their strategy for counteracting account sharing is being put to the test in South America.
Extra Member Program
Netflix’s “extra member” program has been implemented in Chile, Costa Rica, and Peru in March. The program charges extra for additional users who are located outside of the primary household for the account. In order to determine who is part of the “household” users in these pilot countries now have to check in on the wifi of the primary residence once every 31 days; possibly prohibitive for users who are in long-distance relationships, or who have children studying away from home.
On Netflix’s help page regarding account sharing for the aforementioned countries, it is stated that IP addresses, device IDs, and account activity will all be utilized to determine who is using the account, and lock out those who aren’t in the household.
The Groningen Observer spoke with Beck, an international student at RUG who comes from Utah in the United States. Not only is he a customer along with his family in the US, but Beck also owns stock in Netflix. This move towards cracking down on account sharing has him considering selling his stake in the company. “They shouldn’t just be looking out for shareholders. I think, in my experience with businesses, it’s better to be a producer and make something that’s cool…” Beck believes that this decision by Netflix won’t increase their paying user count; it will simply lead users to seek out alternative providers.
The Future of Netflix
The Groningen Observer reached out to a lawyer who counts Netflix among their clients about this strategy, and the future of account sharing. They requested anonymity as their business with Netflix is ongoing. When asked if account sharing can be considered illegal, or whether legal action can be enforced by the company, the answer was no. The change is “purely a business decision” and has no weight in a legal sense. They went on to explain that depending on the results of this experiment, other streaming services could seek to adopt similar models. “If the experiment works for Netflix others will follow suit but this will also largely depend on the users in a given region, purchasing behavior, the domestic markets and may not look the same across the world.”
Considering the methods being utilized by Netflix to combat account sharing, VPNs could provide users with a way around the new system. VPNs allow individuals to mask their browsing with an alternative IP address, and is commonly used to get around geo-locked content.
In a Statement to The Verge, Netflix spokesperson Kumimo Hidaka stated that the streaming service expects to expand the paid-sharing model into different markets by the end of the first financial quarter of 2023. The scope and timeline of a full transition to this model are currently unknown.
