Netflix testing new ways to combat password sharing in three Central and South American countries
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Netflix is starting a test in Chile, Costa Rica and Peru that will charge users who share accounts with those outside their household with the option to pay an extra fee or break the profile out into its own paid account.
The streaming giant has long offered a feature that lets different members of a household set up separate profiles under the same account with the idea that it helps improved individualized content recommendations as well as control over what content kids can browse and watch.
“While these have been hugely popular, they have also created some confusion about when and how Netflix can be shared,” the company said in a statement.
However, the feature also adds another layer of convenience to those who share their account credentials with friends or family who live in other homes.
Netflix even tried to do away with the profile feature, with the exception of the children’s profile but reversed course after backlash from customers. At the time, the company didn’t specifically address account sharing issues as justification, but thousands of customers saw it that way.
Now, customers in Chile, Costa Rica and Peru markets who are suspected of sharing logins with non-household members will be offered two options the company is testing.
The first lets the user create up to two “sub accounts,” each with its own username, password and recommendations, for about the equivalent of $3 per month, depending on the country.
The charges for these accounts still go back to the person who owns the parent account, but the terms of service allow them to be shared with people who don’t physically live with the account owner.
The other option is to break off the profile into a full fledged account and transfer all of the information to a standalone one at regular local rates. This would include separate billing and login information.
Netflix did not indicate how it intends to detect account sharing — likely in an attempt to avoid any attempts to circumvent it — but it presumably can look at data and trends such IP addresses and other network information, how often the login is used at different locations and other information to flag potential sharing.
However, the company also needs to walk a balance because there are legitimate reasons that one account might login from a different location — such as if a family is traveling or in the case of blended families.
Streaming account sharing has become so common it’s well on its way to becoming engrained in our society. It’s not uncommon for circles or groups of friends and family to each sign up for one or two streaming services and then share the passwords with each other — so everyone gets access to the growing number of streamers out there but only have to pay for one or two.
For its part, Netflix says the sharing “is impacting our ability to invest in great new TV and films for our members.”
A recent price hike in the U.S. and Canada is, according to the company, going at least partially toward funding the cost of more programming but it could also result in even more password sharing if account holders find it too pricey.
Streamers, including Netflix, have tried numerous ways to crack down on password sharing, including showing polite messages when it suspects an account might be being shared that remind users it’s against the terms of service to blocking some VPN access (this move is also aimed at users who attempt to circumvent geographic content licensing restrictions by making it appear they are logging in from another location).
Another option has been to start requiring two factor authentication, where a user has to enter a code sent via SMS or push notification to a mobile device every so often.
This, however, could be fairly easily circumvented by simply coordinating with the account holder to get the code and enter it. Requiring the code to be entered within a fairly narrow window of time has been mentioned as a possible way to make this type of authentication more effective, but it also raises a myriad of issues around access to mobile devices, accessibility and edge cases where the user’s phone might not be handy.
Even removing the profile feature likely wouldn’t have a huge impact since most people would be willing to give up personalized recommendations in favor of not having to pay.