The two-year application of Netflix's password-sharing crackdown was fruitful for the platform last year, but now, it is no longer working out as they intended as their growth is staggering. It is all attributed to its anti-password sharing rules within the platform which causes others to leave instead of create a new account if they are not from the same household.
Its famed move was also copied by other streaming platforms like Disney+ and Hulu, as well as HBO's Max, with others also looking to follow suit.
A new report from LSEG (via Reuters) shared Netflix's latest numbers, and since the first quarter of 2024, the platform's numbers slowed down and dropped significantly. In Q2 2024, Netflix saw 4.82 million subscribers only, and this is less than a third of its numbers in the fourth quarter of 2023 which saw around 15 million new subscribers with its password-sharing crackdown in effect.
The password-sharing crackdown in 2023 was said to have worked wonders for Netflix when it took effect, and during the start of the second half of last year, the company reported 5.9 million new subscribers.
Its numbers now are unlike its previous achievements in the past because of anti-password sharing, a move that was famously copied by other streaming platforms.
Should Sharing Passwords Be Allowed Again on Netflix?
Despite these low numbers, Netflix was able to overturn this anti-password sharing issue by doubling its advertising revenue in Q2 2024, reaching around $9.53 billion. This is the highest number of its ad revenue since Q2 2021.
The cheapest ad-supported plan on Netflix costs $6.99 monthly, and its ad-free now starts at $15.49 per month after killing its cheapest plan at $11.99 monthly.
Netflix's Anti-Password Sharing Rule
Word behind Netflix's plans to no longer allow users to use one account for different devices first spread in 2022, with it initially coming to Latin America to test among its subscribers. Netflix Peru was the first to adopt this and see it take effect, but the test reportedly 'flopped' among users, leaving them confused with the new policy and seeing chaos amongst subscribers.
However, this policy from Netflix continued and started its official rollout among other countries, with the United States seeing this massive focus from the streaming platform. It first started earlier than planned but Netflix said that it is still coming; and later in the year, it took effect among users who share one account, with the app asking them to create their own account if detected to be out of the primary household.
Since that time and earlier this year, Netflix regarded it to be a success, and because of this anti-password sharing rule alone, the company gained more subscribers and reported new record highs. Despite these ecstatic beginnings, Netflix is now facing slow growth in its streaming platform as users opt to unsubscribe instead of creating their account, with the company back to square one.
