The crackdown on password sharing by Netflix (NFLX) has been extended to include Canada, New Zealand, Portugal, and Spain.
Following the implementation of similar rules in Latin America last year, users in these countries will now have to pay to grant access to their accounts to people they do not live with.
Netflix started introducing the change last year in Chile, Costa Rica, Peru, Argentina, the Dominican Republic, El Salvador, Guatemala, and Honduras. It stated in a statement to shareholders last month that it intended to implement the new guidelines “more broadly” sometime before March.
In a blog post published on Wednesday,February 9, the streaming giant, which saw significant subscriber losses last year, said that password sharing damaged its profits and constrained its capacity to invest in new content.
More than 100 million households share an account, according to Netflix estimates.
“Over the last year, we’ve been exploring different approaches to address this issue in Latin America, and we’re now ready to roll them out more broadly in the coming months, starting today in Canada, New Zealand, Portugal and Spain,” Netflix said in the post.
Based on its experience in Latin America, Netflix stated in a letter to shareholders that while it anticipated some users will cancel their subscriptions after the changes went into effect, it anticipates that the overall number of users would increase over time.
Concerns about streaming subscription fatigue and growing competition from companies like Disney (DIS) and Apple(AAPL) caused the share price of Netflix to drop by more than 50%
However, the stock has increased 24% since the start of the year, lifted by the falling value of the US dollar. Over half of Netflix’s 2022 revenue came from sources outside the United States, so if the dollar depreciates, its overseas sales and profitability increase when converted back into the local currency.
Author-Roberta Appiah
