Netflix’s Dumb Password Sharing Crackdown Will Cost You $8 Per Moocher
from the big-fat-cash-grab dept
We’ve noted more than a few times that Netflix’s password sharing crackdown is a dumb cash grab, and illustrative of the company’s inevitable transition from innovative disruptor to the type of nickel-and-diming cable company Netflix originally disrupted.
We’ve also noted how the company was forced to delay the effort a few times, after backlash in countries like Spain resulted in it losing a million subscribers — far greater than executives expected.
Undaunted, Netflix this week started turning up the heat on users in preparation of the crackdown, penning a blog post that notes that once active, users will have to pay an extra $8 per person currently sharing your password. Netflix remains a little vague about how they’ll single out these dastardly culprits:
We use information such as IP addresses, device IDs, and account activity to determine whether a device signed into your account is part of your Netflix Household.
We do not collect GPS data to try to determine the precise physical location of your devices.
Contrary to many press outlets, Netflix isn’t enforcing this yet. They’re simply dipping a toe in the water and getting users used to the idea. I’d expect that if backlash is excessive, it’s still entirely possible they back off the idea.
As we’ve noted previously, this genuinely is Netflix being greedy. The company, for years, actively encouraged password sharing, insisting it was no big deal. It also already monetizes extra users per account by limiting the total number of simultaneous streams per login. Want more streams, you already need to upgrade to a more expensive plan.
Then there’s just the risk that Netflix will annoy cost-conscious customers at a time when streaming competition is soaring, imposing cumbersome new limits on the heels of already unpopular flat rate price hikes.
We’ve also noted how the folks advising on how much money they’ll potentially make on this crackdown aren’t really based in reality. The kind of folks that share Netflix password (students, that friend who only watches TV occasionally) aren’t likely to sign up for their own accounts. Younger Americans are increasingly preferring YouTube and TikTok.
This is all assuming that Netflix pulls this off without screwing things up. That hasn’t been the case in the countries Netflix used as guinea pigs to test tech and messaging.
To be clear I don’t think the move will be particularly fatal. A lot of folks still see significant value in the Netflix cost equation, especially when compared to cable TV. But I do think it’s another link in a chain of evidence (like when Netflix gave up on supporting net neutrality when it became wealthy and big enough that it not longer worried them) showcasing that this company is running out of ideas.
Much like it did when Netflix disrupted Comcast, Netflix’s decision to nickel-and-dime its users with punitive, confusing restrictions and fees opens the door for other, more flexible companies to gain inroads simply by being less annoying.
Filed Under: cable tv, competition, media, password sharing, password sharing crackdown, streaming, video
Companies: netflix
Comments on “Netflix’s Dumb Password Sharing Crackdown Will Cost You $8 Per Moocher”
Netflix: “Am I out of touch?
….
No. It must be the users that need to pay more who are wrong.”
What about Military Families?
One thing I haven’t seen addressed yet is military families. The whole reason that I went with a premium plan to begin with was for the ‘extra screens’.
My wife was active duty military (recently retired) and we spent the last several years geo-separated as the military deployed her and moved her around the country.
I do also share with an immediate family member, but kept the more expensive plan out of habit. This news has prompted me to drop to the standard tier, and if I get singled out for sharing, I’ll probably drop the account completely.
Re:
The problem here is there’s all sorts of edge cases that could be affected, most of which couldn’t be predicted, but almost all of whom would have previously thought they were OK. I don’t agree with the people whining about Netflix’a supposed drop in content quality, but even the threat could cause a lot of people to cancel because of that impression. Then, will people sign up for a new account? If they’re literally using it full time maybe, but for the people who use sharing to support people who can’t afford one, or who are falsely accused of haring? No.
My sister and I upped our subscription and dropped the DVD service way back when they first offered four streams. This was so we could let our nieces use the other two streams.
The warnings NetFlix was popping up yesterday on our Roku’s and other devices made it very clear they want another $16/month from us to keep using 4 streams for 4 people.
Our nieces and us decided that is ridiculous, especially since they rarely use it anymore. So instead of getting 75% more money from us, they now get 25% less because we dropped back to two streams yesterday.
Going, going... gone!
I’m in UK and this bs has just been rolled out. Cancelled my subscription right away. There’s no way I’m paying an extra £5 on top of an already expensive £11 per month so that another member of my family can watch. I hope lots of fellow Brits cancel, there’s a lot more choice out there these days. So I’ll probably dive into AppleTV+ and maybe Paramount+ too.
Re:
I’m from the UK and I also cancelled today for the same reason.
I’m sure many people will be, especially as there are better offerings from other providers that aren’t enforcing this crap.
When the producers take to the crowd funding with free distribution model, the streaming services and cable companies will really feel the pain. When you are a middleman, it pays to consider what is best for both you customers and suppliers, especially when they have alternatives available.
Kids in School
I have two daughter’s away at school during the school year. They still have an official residence in my house. They stream the same content on the same devices whether they are at home or at school. One is a high schooler, so she’s literally a dependent child. Yet, Netflix wants me to pay an extra $16 a month for them to keep using the account. How does that make sense? What possible cost-of-service rationalization can they give me that justifies charging more for the same person in a different location? There is none. It’s just a pure money grab.
I’m done. I had canceled when they first announced this, but a gift card we got for Christmas brought us back temporarily since they didn’t actually roll it out. Now, I’m out for good, and I let my brother know that a gift card will be wasted because we will never have a Netflix sub in our house again. Eff this company. They need to see massive, long-term losses as a result to prove to the rest of the streaming industry that this is a terrible idea.
Re: VPN
Same for my son in college. This is another reason why he has a VPN to our home: so he can login to services that expect him to be at our residence. Same for when we’re traveling.l
Stock value
This is what has happened in every industry where improving shareholder value every year is put above the quality of the product.
Re:
It’s even dumber than that I’d say as this is at best aiming for short-term gains at the cost of long-term stability.
Sure they may be able to squeeze some more money out of some people but how many are going to see the price being jacked up and decide that it’s simply not worth it to get more than the absolute basic offering, or just drop the service entirely?
So I don't share passwords
And barely use netflix, but there are some things last I knew that I needed to watch on my laptop cuz the roku didnt cut it, so if that sets this crap off, how….. is that not some form of entrapment?
Risk being ripped off versus just drop the service, choices choices...
Netflix: Pay extra for the ability to stream to multiple devices at once.
Also Netflix: If we think that the devices using your account aren’t located in the ‘correct’ area then you get to risk paying $8 a pop for each ‘extra’.
Re:
“think” is the big issue here if they crack down too much.
I wouldn’t support it, but I could understand if it was just 20 households streaming in ways that avoided the 4 device limit.
But, what they’ve mentioned easily hits people who travel. Or watch at work and home. Or give an account to an elderly relative who wouldn’t afford their own account. Or…
The fact they encouraged this is bad enough, but the criteria they mention doesn’t convince me that they won’t get a lot of false positives, so they are attacking their own customers. Some of whom use them because they originally offered this part of the service.
Plans already include moochers
I reviewed their plans last night. The higher quality streaming plans already include one or two people not living in the household, and at a lower price point than $8 per. That should help reduce the impact. And $8 is still less than the cost of your own Basic. I’m with Netflix on this one.
Re:
If I’m paying for 3 simultaneous streams, 3 simultaneous streams should be the end of the discussion. No “only on approved devices”. No “only from approved locations”. No “call to get your account reactivated because we think you were cheating.”
You can be with Netflix all you want. I’m not willing to put up with a bit of it.
Re:
Where did you find these plans? Yes, higher tiers include more active streams/screens, but now Netflix is saying that they all have to come from the same ‘household.’
Traditionally, Netflix has always allowed those streams to come from outside of the household, and even encouraged sharing accounts at one point.
It’s completely within their rights to step back from that, but I don’t think they will find many who are on their side for it (other than shareholders).
Re:
“moochers”
Sorry, if the plan is I can stream 4 devices, then that’s 4 devices. It used to be that if my girlfriend is at home and I’m in a different country working, both of us still get a stream, even if a kid’s in another room streaming something else. Unlike other companies, Netflix offered me the local catalogue of titles while others would block me, which is why we signed up.
Now, they’re trying to say that if they think we’re not in the same “household”, the 4 device limit is removed and I have to pay extra? Nah…
Re:
Please explain to me how multiple devices watching Netflix on the same account in one location is not mooching but if they’re in different locations it is. Please explain how this actually results in extra cost to Netflix instead of just being a deplorable cash grab to please shareholders.
Re:
I saw nothing in the plan choices for our USA Netflix account that allowed people not living in the household.
All I was offered was our current plan, $20/month, that gives four streams and is limited to only people in our house, not family. They also offered to let me add people outside the house to the $20 for $8/each bringing the total to $36/month
Perhaps they had it and it’s so hidden so well by them that I can’t find it.
Have you got a link to the plan(s) that include “people not living in the household”.
Cory Doctorow wrote an article in The Atlantic about “Computer says no”. Starts off on Netflix, but continues through anecdotes of his experience with the Digital Video Broadcasting panel’s definition of “Family” (IE let’s cover all the Rich White Family definitions and shit on everyone else), and touching on how Feeding The Computer with a standardized name became a nightmare after 9/11.
Netflix is becoming dispensable
I’m looking forward to seeing a sudden dip in revenue as this policy causes more subscription cancelations than upgrades. I’m thinking hard about finally pulling the plug
You can pay us for 4 simultaneous streams, you just can only use them in your home…. for reasons.
Re:
Maybe they think all these are Dominionist accounts, with a dozen children.
This just makes me wish I were still a subscriber so that I could cancel again.
I’ve said it before here. I’ve gotten noted for saying this before – I used to pay for 4 simultaneous streams. I needed 3. My only options were 2 and 4. If Netflix needs more money for me to use 4 streams instead of 3, they should be charging me more upfront. It costs them no more if that 4th stream is in my home or at my work or across the country. If I had 4 computers running Netflix 24/7 they could charge me nothing more than they already charge me, and that shouldn’t change when I go into the office.
They announced this change on top of a price increase last year. They lost my business then. After paying a premium for 4 streams, they want to also charge me more to use those streams? I love Glass Onion and want to share it with people, but not that much.
I'm glad I'm a subscriber
So now I can cancel. Not because of the crackdown, because their content is garbage. Used to be good, but it’s been on a downward path for years and I’m done.
I’ve seen several places saying that your devices need to log in once per month from your household network to count.
I’m not sure how much of an edge case this is, but I have an Amazon Fire stick that I only use on vacations and other trips. It’s super convenient while traveling to connect it to a screen and play things, but I have absolutely no use for it at home, and there’s no way I’m going to be bothered to mess with it once a month.
While I’m traveling is also, coincidentally, when I am most likely to actually have free time to watch things on Netflix. If they decide to make themselves unavailable at the best time for me to actually use them, then there are definitely other places for me to spend my money.
Next they will demand a fee per every occupant in the room, including pets. The cams are already in place, I’m sure facial recog will work out fine for them. /s
Re:
You joke, but there’s already a patent out there for something like that (don’t remember from who though? MS? Sony? Something similar)
When my daughter goes off to college this fall, she’ll still use our house for her legal/permanent address everywhere. She’ll still be a dependent on our taxes. Most of all, she’s still part of our family.
If Netflix won’t treat her accordingly (this isn’t certain yet), we WILL ditch them for an alternative that does.
Netflix vs DVD
I’ve been post Netflix for a long time but these new restrictions have put me off of Netflix forever. I can by a dvd and take it to my friends weekly movie night. But if I buy a streaming box put my account on it I can’t take that box to movie night plug it into my friends tv and watch Netflix? Goodbye.
Yeah there’s going to be somethings I’ll never get to see and I’m OK with that.
Re:
To be fair, that’s just the vagaries of copyright.
When someone gets a licence for a movie/show, they have a licence for X amount of time usually. When it’s on a DVD or other physical medium, the licence check is applied when the disc is created. When it’s digital, it’s when the copy is made also, but that means when you request it. So, Netflix could supply an out of print DVD to you years after it was released, but they can’t stream a movie 2 seconds after their licence expired.
I wouldn’t defend these actions, but in this case your beef is with copyright law and licencing, not Netflix.
Not $8/moocher, but $8-per-month-per-moocher
$8 wouldn’t be a big deal at all, but we’re talking about $8 per month. That’s equivalent to a one-time fee of several thousand dollars, depending on interest rates.
Two Internet services
I have never subscribed to Netflix, and have no interest in doing so. This has no effect on me in real life, but it brings up an interesting problem.
I have two Internet services here, one cable and one dsl. My computers use one or the other more-or-less randomly, but that means I have two “outbound” IP addresses and my traffic goes through two different ISPs even though it’s from the same computers in the same rooms.
I wonder if Netflix would decide that I was two different households because of that.
Yup, came here to say this! I have a son who is active duty military. the idea that he can just up and come home every month to keep the netflix sub from charging us more is hilarious. not to mention my mother in law who lives in a retirement community that we paid for the higher tier for so she has something to do since cable there is insane for cost
As I’ve already informed netflix, the minute they charge me extra I’m out. there’s entirely too much competition in the streaming space for me to stay with them since for example, Amazon Prime doesn’t care what my location is, or how many people I have using it, as long as i pay my yearly sub
Doctorow's enshittification principle
Cory Doctorow coined enshittification to describe a process where a tech firm degrades its service by locking in customers, making them captive to advertisers or vendors, then degrading the terms on the business side as well. Surpluses are skimmed by shareholders.
I’m thinking that enshittification is also inevitable of any technology because it’s the only possibility for generating growth and value.
Netflix and Twitter are evidence of the inevitability of enshittification. Netflix’s troubles began when it reported a decline in subscriptions. The markets punished the streaming industry as a whole, shearing the valuations of Disney, NBC and especially Warner Bros. Discovery.
Elon Musk has been a radioactive influence on Twitter, and he’s driving away users and advertisers and seemingly enshittifying Twitter out of spite or making Twitter an extension of his alt-right personality and worldview. Yet everyone who has left Twitter is also unhappy with every alternative that they’ve tried, due to a small user base, difficult user experience, or conversations being even more filter-bubbled. Twitter refugees ended up talking down the competition and in many cases, returning to Twitter and bowing before Alpha Elon in shame and guilt.
There should be 20 netflixes all with the same content.
Who is delivering the full Atmos surround-sound tracks? Who is delivering the best recommendation algorithms?
Who has the best and easiest to use interfaces?
Instead we are stuck going to 20 different places to get content… and most of the time the content you want is locked up behind a really shitty interface and only delivers quality far less than what should otherwise be available.
Fuck that noise. Time to go back to piracy.
There’s a vocal minority on the Ars Technica comment thread for this – several posters apparently feel fit to speak up on behalf of Netflix, mocking those who threaten to cancel as having abused the password sharing loophole and refusing to pay $8 a month as if it’s an astronomical cost. There’s also the unsurprising dropped accusation of piracy.
Let’s be clear here: when you don’t like the terms and conditions and do without, just like content creators and copyright holders demand that you do, it turns out they don’t like that either. All you are to them is a bank account with legs.
FFS! an IP address ist not a person!
An IP address that is somehow “collected” in the bowels of the internet can not be used as any form of identification!
Why you asked? Since an IP address is technically trivial to fake, just ask your neighborhood VPN!!
Another article about Netflix’s password sharing cash grab, another misuse of “competition”.
The streaming market is not becoming more competitive. It’s becoming more fragmented – particularly with the major studios offering their own services they can easily gate their own content behind while removing that same content from other services.
I pay for 5 screens. I should be able to view on 5 screens. An IP address isn’t me or my family.
Netflix
Ok.
There are a number of comments that seem to show that posters may have not understand how this actually works
1st, let’s start this by referencing
https://help.netflix.com/support/128339?g=89282eaf-e1e3-4197-b133-841722914428&lkid=URL_HELP&lnktrk=EVO
which is the Netflix help page.
Now, as I have been working in technology for 30+ years (longer than some of y’all have been alive), I believe I may actually have a better handle on this than most. Let’s break this down:
“We use information such as IP addresses, device IDs, and account activity to determine whether a device signed into your account is part of your Netflix Household. ”
What you are paying for is ACCESS to a service. There are 2 components to accessing ANY network. Both components MUST exist in order for data communications to occur.
IP Address: IP Addresses are assigned to a subscriber by an Internet Service Provider. This differentiates your house/network from your neighbor.
“Device IDs”: This is based on MAC ID’s which serve to provide a unique identifier for EVERY device on YOUR network (see https://en.wikipedia.org/wiki/MAC_address for an explanation)
Now, let’s talk about MONEY cause this is what it is ALL about.
THE Rule: “There Ain’t No Such Thing As A Free Lunch” (R.A. Heinlein)
Everything has a price/cost and Technology is NO DIFFERENT.
To start with, Netflix is a company that has to pay it’s employees, pay for the equipment they HAVE to have for all of the content they offer, the power to run it all, etc.
Next, you’ve got the “Interconnection Fee” which is what YOUR ISP charges Netflix for access to THEIR network, which you connect to (see https://www.internetsociety.org/blog/2022/04/common-internet-network-interconnection-and-charging-practices/ for more information).
These fees can be really high. Some years ago, while working at Comcast, there was an situation, when Comcast demanded an increase in Interconnect Fee from Netflix to cover the cost of Data Access across their network due to the number of Netflix subscribers.
Comcast was making noises about blocking Netflix from the network. A new interconnect fee deal was reached, allowing Netflix to continue to reach Comcast customers.
Now, the cost pass along was not immediate, but it was done.
The bottom line is
THE Rule: “There Ain’t No Such Thing As A Free Lunch” (R.A. Heinlein)
Everything has a price/cost and Technology is NO DIFFERENT.
If you read the help page, there is a mechanism set up for all of you who need Netflix access in different physical locations.
I’ll be setting that up as my wife acts as caretaker for her elderly parents and is over at their house a lot.
REMEMBER: this is TECHDirt and you can learn all sorts of stuff from the Net if you just dig hard enough
Re:
Yes.
That’s why I’m paying a monthly subscription fee, Johnny.
Re:
We got a live one. Random WORDS that are IN CAPS because they need to be SHOUTED.
Re: Re:
He HAS to use a lot of capital LETTERS because he is SO much smarter than US.
You can tell he’s smarter than us because he keeps telling us he is. As we all know, the surest sign that somebody is smart is that they have to constantly tell people how smart they are.
Re: Re: Re:
WOAH deja “vu”!
Every Naion teatts the Paint chips it DESERVES!
Re:
“the Netflix help page”
Which may or may not have changed since people agreed to the original contract, especially since the time the company actively encouraged password sharing.
“What you are paying for is ACCESS to a service”
Yes, a service that’s been accessible outside of my home. Even when in a different country to the other people in my household.
“Everything has a price/cost and Technology is NO DIFFERENT.”
Yes, the price used to be “pay for up to 4 devices to stream, we don’t care where they are”. People are complaining because that rule changed and it’s unclear how it affect people within a “household” who don’t all sit in different rooms ignoring each other while watching Netflix.
“These fees can be really high”
Wait, I was reliably informed that they get it for free which is why they need to be charged by ISPs because their customers are using so much data. (dumb, but read more articles here if you don’t get it…)
“THE Rule: “There Ain’t No Such Thing As A Free Lunch” (R.A. Heinlein)”
Yet, you’re attacking people who are paying.
“Everything has a price/cost and Technology is NO DIFFERENT.”
Indeed, so when I pay Netflix and my ISP to access Netflix then I expect to get access even if I happen to be outside of my home at the time, because I’m also paying for other data.
“REMEMBER: this is TECHDirt and you can learn all sorts of stuff from the Net if you just dig hard enough”
Except human interaction and reading comprehension, apparently.
Re: Re:
If out_of_the_blue was still around he’d have pointed out how this Johnny Shade guy constitutes a zombie. But what’s strange is that J-Shade isn’t even someone new, and has more or less held very reasonable perspectives on the stupidity exhibited by pro-IP lunatics.
So him framing the issue as one about money, and doing so in a way that basically amounts to saying “Everyone who disagrees with Netflix is a cheapass” in an incredibly backhanded admonition, is pretty damn strange. Nobody disputes Netflix has to pay various entities to get their business model functioning. Techdirt extensively covered how ISPs worldwide were hammering Netflix with increased costs just because Squid Game was briefly popular for a hot minute. It sucks for Netflix. That still doesn’t mean consumers suddenly lose the right to cancel their services if they think it’s more expensive than they’re comfortable with. Nor does it make people who cancel their service morally repugnant, or thieves.
Why does no one talk about the simultaneous stream limitation?
What boggles the mind in this cash grab is why no one is focusing on the pre-existing limitations on simultaneous streams.
If I pay for two simultaneous stream, why are they upset that there are, count them, two different devices streaming at the same time. Who cares where they are? Well apparently Netflix. I guess they envision customers dumb enough to think it is fair to pay for a subscription for home use, and a second “add-on” for remote use.
I am getting sick of this “freeloader/Password sharing” rhetoric, NO ONE WAS EVER GETTING NETFLIX FOR FREE.
If they want users to pay for every single device then make a subscription for that. They can ask the cablecos how making customers pay a fee for every single tv screen is working out for them…
Cancelled
I cancelled my Netflix account, not because I’m directly impacted by this (I am not. No one outside of my immediate household used my account) but on principle. Most Netflix-exclusive shows make it to physical media eventually, do I can still consume those shows that way. It sign up for a single month when a new season drops, if it’s something I just can’t wait for. Will my actions bankrupt Netflix? Not at all. But I still felt it was the right thing to do.
$8 charge
I think the $8 charge is temporary. Netflix will end up using this information to make these people get their own, more expensive, accounts.