The Netflix sharing crackdown is closing in this spring

If this were a horror movie, this is the bit just before the baddie comes through the door with a chainsaw

Netflix account sharing
(Image credit: Netflix)

Like all the best scary movies, Netflix has been foreshadowing its account sharing crackdown for what seems like ages – but the streaming service's latest financial report shows that it's just a matter of time now before the password crackdown starts picking off your favourite characters. The crackdown is coming to the US, and it's coming very soon.

The announcement didn't come via a press release or the Netflix blog: it's in this PDF for shareholders. Netflix says that "we’re pleased with the results of our Q1 launches in Canada, New Zealand, Spain and Portugal, strengthening our confidence that we have the right approach." So the US is next, and it's going to happen before this summer.

What effect has the Netflix password sharing crackdown had?

According to Netflix, "we see a cancel reaction in each market when we announce the news, which impacts near term member growth. But as borrowers start to activate their own accounts and existing members add 'extra member' accounts, we see increased acquisition and revenue." In Canada, probably the most similar market to the US, "our paid membership base is now larger than prior to the launch of paid sharing". Not only that but "revenue growth has accelerated and is now growing faster than the US."

Netflix is clear that it expects a lot of US subscribers to quit, but it sees that as acceptable losses and very much a short-term thing: in the longer term it expects numbers to recover and improve over the pre-crackdown figures.

It's unclear what the US pricing will be, but in Canada the charge is roughly USD$6 extra per month per person and you can add up to two people to your Standard or Premium plan. Accounts are tied to a single location but there are allowances for travelling and people who live in more than one place.

It looks like the UK has dodged the account sharing bullet for now, but that doesn't mean it won't come soon: with account sharing being monetized in Canada, New Zealand, Spain, Portugal and soon the US, it's not a question of when Netflix will bring the changes to the UK; it's just a question of when.

Carrie Marshall

Writer, musician and broadcaster Carrie Marshall has been covering technology since 1998 and is particularly interested in how tech can help us live our best lives. Her CV is a who’s who of magazines, newspapers, websites and radio programmes ranging from T3, Techradar and MacFormat to the BBC, Sunday Post and People’s Friend. Carrie has written more than a dozen books, ghost-wrote two more and co-wrote seven more books and a Radio 2 documentary series; her memoir, Carrie Kills A Man, was shortlisted for the British Book Awards. When she’s not scribbling, Carrie is the singer in Glaswegian rock band Unquiet Mind (unquietmindmusic).