“Gradual progress in banning account sharing” Netflix, subscribers leaving, reducing impact
“Gradual progress in banning account sharing” Netflix, subscribers leaving, reducing impact
Globally based OTT Netflix plans to implement a policy prohibiting account sharing. The industry is concerned that this policy may cause user exodus.

As of the 3rd, when you access Netflix on your TV, the phrase ‘Please confirm this TV as a device included in your Netflix-using household’ appears. There is also information that says, 'Devices that use your Netflix account on the same Internet as this TV are automatically included in your Netflix usage household.'

Netflix has announced a ban on account sharing and is cracking down on it in Korea as well overseas. When asked by Ten Asia when the ban on account sharing will be implemented, a Netflix official responded, "It will be implemented gradually." Although the exact time has not been set, the industry is speculating that the policy will be implemented as early as this year or as late as January 2024, as related information has already been announced to each account user.

On the 2nd, Netflix announced its changed sharing policy, saying, "The only people who can use a Netflix account are people who live with the member, that is, members of the same household." Accordingly, family members, friends, acquaintances, groups, etc. who do not use the same address will not be able to share the same account. Netflix plans to require users to pay an additional fee of 5,000 won per month to share an account with users who live in the same household and do not use the same Internet IP address.

According to the information email, Netflix plans to identify the user's default location through the user's IP address, device ID, and access location. Users sharing an account must access Netflix through certified Wi-Fi at least once a month on their own devices to use content. Even subscribers living in the same household are required to go through cumbersome procedures for device recognition.

Netflix, which was able to share accounts with up to four people on the condition that their viewing history was kept private, seems to be losing public support as it cracks down on banning account sharing based on this standard. In the community site posting containing this news, there are a series of responses saying they will quit the subscription, such as 'Let's go cancel' and 'You can just watch YouTube'.

There are also voices of doubt and dissatisfaction regarding the criteria for banning accounts. Responses such as ‘Does this mean that any number of devices can be shared using the same IP?’ and ‘What happens if the account holder wants to watch Netflix on TV while traveling, on a business trip, or at home?’

A media industry official said, "Most of Netflix's current subscribers are probably sharing accounts," and added, "If the account ban policy is implemented in earnest, there is a high possibility that actual users will leave. Users who regularly consume Netflix content will consume more. “It will stop,” he said. In this case, the impact of Netflix content itself may be lower than before.

However, this official predicted that even if actual users leave, the number of account subscribers will increase. An official said, "There is a high possibility that there will be more subscribers to the account. If the ban policy is implemented under the assumption that four people were sharing one Netflix account, wouldn't there be a possibility of three subscribers potentially occurring? Even if only one of them subscribes, “Netflix will receive double the profits,” he said.

In fact, Netflix reportedly implemented a policy prohibiting account sharing in overseas countries and secured an additional 8.7 million subscribers in the third quarter of this year. Netflix is said to be moving to push for a fee increase based on this.

Some predict that the ban on account sharing will put pressure on Netflix regarding content quality. Another official predicted, “If account sharing is prohibited and subscribers pay more than before, expectations for content will increase,” and “expectations to satisfy satisfaction in various ways will increase.”
“Gradual progress in banning account sharing” Netflix, subscribers leaving, reducing impact
“Gradual progress in banning account sharing” Netflix, subscribers leaving, reducing impact
In addition, the recent forecast that Disney Plus will postpone its account sharing ban until 2025 is also expected to be bad news for Netflix.

Walt Disney Company CEO Iger said in the third quarter earnings conference call on the 8th (local time), "We have an opportunity to improve our streaming business centered on account sharing," but also added, "Considering the planned timing, it will not have a significant impact until 2025. “It is expected,” he said. Iger's remarks are being interpreted as a determination to maintain the account sharing policy until 2025.

While Netflix is counting down the days to implement its policy to ban account sharing, if Disney Plus allows account sharing by 2025, it is highly likely that Netflix will lose points to those who leave Netflix.

An official said, "It is not yet confirmed, but if Disney Plus allows the account sharing policy and pays a little attention to content quality and diversity, it will embrace Netflix's defectors and is expected to have a positive effect on future performance."

Choi Ji-ye, Ten Asia Reporter wisdomart@tenasia.co.kr translated by google