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Netflix: The end of account sharing is a great success - for them

21/7/2023

Translation: machine translated

It seems that Netflix has finally put the year 2022, which was plagued by a decline in subscriptions and revenue, behind it. Paid account sharing is a complete success - for Netflix.

Since May 2023, Netflix has actively prevented account sharing in 100 regions. This is because sharing your Netflix password with people outside your own four walls is prohibited under the Netflix terms of use. In theory, this can even be penalised by having your account blocked.

If you still want to share your password, you can, but only with a maximum of two other profiles - and only for an additional charge: so-called "paid account sharing". For everyone else, there is no choice but to create a completely new subscription. The American streaming giant has not made any friends with this.

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Account sharing on Netflix now costs - what you need to know
by Samuel Buchmann

Those who hoped that Netflix would cut themselves in half with this reputation killer are in for a bitter disappointment.

Paid account sharing: a success in figures

Since the introduction of paid account sharing, Netflix has registered 5.9 million more paying accounts worldwide, according to the annual report. In addition, revenue per account grew in all paid account sharing regions thanks to the new additional fees. The company's operating profit thus totalled USD 1.8 billion in the second quarter and is expected to grow in the coming quarters.

The "successful start", according to the annual report, is in line with figures published by the American data company Antenna last June . In it, the company spoke of an average of 73,000 new registrations per day during the month of June. A record - the streaming company has never recorded such rapidly rising figures, even during the pandemic.

The fears - or hopes, depending on your perspective - that customers would flock to the competition were therefore unfounded. At least for the time being. It remains to be seen whether people will want to remain loyal to the Californian streaming service in the long term despite the more expensive plans. However, if the plan works out, Netflix is likely to become a trendsetter for other streaming services too. Even if cancellations increase again. As long as the revenue per account and total revenue increases, the calculation works.

And the next revenue-boosting measure is set to do exactly the same thing.

No more basic subscription = more money for Netflix

Netflix is planning to completely scrap the low-cost basic subscription. Corresponding tests have already been carried out in Canada since June. The tests are now being extended to the United States and the UK.

In Switzerland, the basic plan currently costs 11.90 francs per month. With the cancellation of the basic subscription, the standard subscription for 18.90 francs per month would now be the cheapest. Unless Netflix were to introduce the ad-supported plan in this country too. In Germany, it costs three euros less than the basic plan. In Switzerland, a price of 8.90 francs would therefore be conceivable - if you accept adverts. Netflix would earn less money from the subscription fee alone, but would make up for it with advertising subsidies and ultimately even increase revenue per subscription.

Netflix is optimistic. While the ad-funded plan was not very successful at the beginning, it has now attracted 5 million subscribers worldwide. <p

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Luca Fontana

Senior Editor

Luca.Fontana@digitecgalaxus.ch

I'm an outdoorsy guy and enjoy sports that push me to the limit – now that’s what I call comfort zone! But I'm also about curling up in an armchair with books about ugly intrigue and sinister kingkillers. Being an avid cinema-goer, I’ve been known to rave about film scores for hours on end. I’ve always wanted to say: «I am Groot.»

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Netflix: The end of account sharing is a great success - for them

Account sharing on Netflix now costs - what you need to know

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No more basic subscription = more money for Netflix

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Account sharing on Netflix now costs - what you need to know

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