Sharing your Netflix account outside of your family will end soon. The streaming giant announces that it will be launching paid sharing options soon.
Netflix said in its Q4 2022 earnings report that it will roll out paid sharing “more widely in Q1 23” after trials in parts of South America. The company expects some “cancellation response” in each market as the paid exchange rolls out, but it also expects subscriptions to pick up in the second quarter, leading to an improvement in overall revenue, the company’s main metric at the moment. .
“Today, widespread account sharing (over 100 million households) threatens our long-term ability to invest in and improve Netflix and grow our business. While our Terms of Service restricts Netflix use to a single household, we recognize that this change applies to members who share their account more widely,” Netflix said.
Among the new features coming to paid sharing, members will be able to check which devices are using their account. Subscribers will also be able to transfer a profile to a new account, and subscribers will be able to choose to pay for people living outside the household. After all, someone has to pay, whether it be the household or someone using the account outside the household.
“As we launch a paid exchange, members in many countries will also have the option to pay extra if they want to share Netflix with people they don’t live with. Like today, all participants will be able to watch while traveling. , whether it’s on a TV or a mobile device.”
In July, Netflix dropped the “add household” feature in Argentina, the Dominican Republic, El Salvador, Guatemala, and Honduras based on user feedback. Instead, Netflix allowed people who do not live in a subscriber’s household to transfer their Netflix profile to their account and retain all of their recommendations and preferences when they start paying. In addition, subscribers have the option to pay for others by creating additional accounts using the “additional member” option.
$2.99 for additional member
Netflix did not reveal the price for the paid sharing or the rollout schedule in different countries. In Costa Rica, the cost of an additional member is $2.99.
In addition, Netflix co-founder Reed Hastings stepped down as co-CEO after 25 years at the helm of the company. He is now the executive chairman. The new chief executives of Netflix are Ted Sarandos, current co-CEO, and Greg Peters, former chief operating officer of Netflix.
Another new source of income for Netflix – advertising – was launched in November in partnership with Microsoft. Netflix said its ad-sponsored $6.99 U.S. subscriptions attracted additional subscriptions. However, no premium subscriber has switched to the ad-supported option, which offers fewer features, such as the inability to download content for offline viewing. Netflix said the impact of advertising on revenue in 2023 will be modest.
The company’s paid subscriptions in the fourth quarter of 2022 grew 4% year-on-year to $230.75 million, while revenue increased 1.9% year-on-year to $7.85 billion. The company added 7.6 million new subscribers worldwide, including 909,000 in the US. But the average income per member fell by 2% compared to last year. Netflix largely missed out on its earnings per share (EPS), which came in at 12 cents versus an expected 36 cents. EPS is down from $1.33 in Q4 2021.
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