Netflix registers subscriber jump after password-sharing crackdown

Updated on: 12 June 2023

Gintaras Radauskas
Senior journalist

Netflix’s new password-sharing block seems to have had its intended effect, new numbers show. The streaming giant saw a massive jump in new subscriptions right after it started applying the new rules in the US, its largest market.

The measure seemingly became the impetus for Netflix’s largest spike in fresh memberships in four years. According to research firm Antenna, Netflix gained more new subscribers in the four days immediately following the start of its password-sharing crackdown in the United States than in any similar period since 2019.

antenna-netflix — Netflix has been adding subscriptions lately. Courtesy of Antenna.

For example, the streaming service saw nearly 100,000 daily sign-ups on both May 26th and 27th. Across the four-day period, the average daily sign-ups to Netflix reached 73,000, a 102% increase from the prior 60-day average.

Antenna reports that these numbers exceed the spikes observed during the initial Covid-19 lockdowns in March and April 2020. Cancellations have been prevalent, too, but many more new members have joined than left.

That’s precisely what Netflix was aiming for when it announced the password-sharing crackdown. The new policy bans subscribers from sharing their password with someone outside their homes, and on May 23rd users started receiving emails informing them that extra fees would have to be paid in order to be able to keep sharing the account.

netflix-steff — A notification to a Netflix user. Image by Cybernews.

Netflix now tracks device IDs and IP addresses. Adding a new user free of charge is now impossible, at least officially – it costs $7.99 a month.

The company’s move is still unpopular with millions of users. Many of them are seemingly still hoping for the new policy to fail and are frustrated by the latest numbers and the fact that Netflix’s share price has been surging lately.

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Some speculate that Netflix can add as many as nine million paid subscribers thanks to the crackdown. On the other hand, this might be a one-time effect – once all those former freeloaders sign up, a new growth in memberships will become very difficult to achieve.

For years, Netflix didn’t care about password sharing because it was fueling growth. But the company suffered heavy subscriber losses last year, and said that the practice is hurting its business. Netflix has previously estimated that more than 100 million households worldwide shared an account.

In some countries, the password-ban crackdown started earlier than in the US. The effect in Spain must have been concerning for Netflix. In April, Kantar, a data analytics company, said that the firm had lost more than one million subscribers in the Iberian country since the crackdown began.