HomeNewsNetflix ends password sharing in India: What’s the reason behind it?

Netflix ends password sharing in India: What’s the reason behind it?

Netflix has announced that password sharing is now coming to a halt in India. Here’s how it plans to do so.

Netflix has had plans to end sharing since 2021 and beginning from February earlier this year, the plans have been put into motion. While India wasn’t a part of the list of countries where the move was taking place, it is now changing as Netflix has officially announced that password sharing will now be coming to a halt in the country.

The update was shared officially by Netflix specifically regarding its India operations. “Starting today, we will be sending this email to members who are sharing Netflix outside their household in India”, said the streaming platform in a statement. It also shared screenshot of the mail stating that a Netflix account is for use by one household.

“Everyone living in that household can use Netflix wherever they are — at home, on the go, on holiday — and take advantage of new features like Transfer Profile and Manage Access and Devices”, said the company.

How will Netflix stop password sharing?

Netflix accounts in India who are sharing password across various locations will now have difficulties accessing the streaming platform. Netflix says that there are two ways by which you can verify that account is being used by the primary household member. Firstly, you can enter verifications codes for access for up to seven days, or secondly, you can connect to a network in the primary location where Netflix is mainly accessed at least once every 31 days.

The company is verifying devices in a household by tracking addresses, device IDs, and account activity from devices signed into a particular Netflix account. Viewers in India are also being asked to transfer existing profiles to new paid memberships. However, in many regions, Netflix brought paid sharing so users can pay an additional fee for sharing the account with someone outside the household. However, this functionality doesn’t seem to be available in India yet.

What’s the reason behind the move?

The main reason behind the move is profitability that was taking the hit in Netflix’s case. People have been sharing passwords for Netflix accounts for a while now and every password shared with a user is a subscriber lost for the streaming platform. Netflix, earlier this year, said that 100 million customers are going to get affected by this move.

Netflix also confessed that Password sharing has impacted its “ability to invest in great new TV and films”. The company announced in 2022 that for the first time in over a decade, it had lost a major number of subscribers. As per Netflix’s earnings report for 2022 Q1, the brand had lost a whopping 200,000 subscribers.

In 2022, former Netflix CEO Reed Hastings expressed concerns regarding the streaming platform not doing well in India. “The great news is in every single other major market, we’ve got the flywheel spinning. The thing that frustrates us is why haven’t we been as successful in India. But we’re definitely leaning in there”, he had said.

However, in Q3 of 2022, Netflix came back on track and added around 2.4 million subscribers. Netflix’ subscriber count in India, according to analysis from consultancy firm Arthur D Little, stood at 6.1 million as of March 2023. While its way too less compared to the competition, such as Disney+ Hotstar with 51 million subscribers and Amazon Prime Video with 22.3 million, India still plays a major role in Netflix’s business.

Back in November of last year, Netflix said that it aimed to add 100 million subscribers from India alone. With the crackdown on password sharing, Netflix should definitely be able to procure some more profit from Indian users.

Results of halting password sharing

Netflix also reported via its earnings call earlier today, that it added 5.9 million subscribers in the second quarter and now has over 238 million subscribers. Netflix confirms that stopping the password sharing practice is working well for the company. “Let’s face it, the crackdown on passwords is working,” Navellier and Associates chief investment officer Louis Navellier said.

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