Streaming giant Netflix (NFLX) has outlined its plan to crackdown on the costly practice of password sharing.
Netflix says that accounts will remain shareable but only within a single household. Going forward, Netflix will require users to identify a “primary location” for all accounts that live within the same household.
Users will then need to sign into the Wi-Fi of the primary location at least once every 31 days to ensure their device is not blocked.
The company said it will use information such as IP addresses, device IDs, and account activity to determine whether a device signed into the account is connected to the primary location as required.
When someone signs into the account from a device that is not part of the primary location, or if the account is accessed from a different location, it will likely be blocked by Netflix.
Netflix has warned repeatedly that it plans to crackdown on password sharing, a practice that it estimates costs it more than $5 billion U.S. in lost revenue each year.
Netflix reported net new subscriber additions of 7.66 million in the fourth quarter of 2022, above the 4.5 million it had guided for amid a slew of high-profile new content on its platform, including the “Glass Onion” and “All Quiet on the Western Front.”
Netflix’s stock has risen 23% to start 2023 but is down 16% over the last 12 months at $361.99 U.S. per share.
