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How much will Netflix gain from blocking password sharing?
Some analysts predict that Netflix could noticeably increase its revenue if it decides to enforce its terms of service more robustly.
$1.6 billion a year in the background
Reports that Netflix would like to curb account sharing began to appear some time ago. It seemed that it would end with speculation, but recently the black vision for some users began to come true. And looking at the amounts appearing in this context, the actions taken by website managers should not surprise anyone.
According to the estimates of analysts from Cowen & Co., whose report is cited, among others, by Variety, Netflix can gain a lot from tightening the screws on some of them. In this context, the figure is USD 1.6 billion a year. Of course, assuming that account sharing fees will be introduced worldwide.
A lot? For the average person, yes, and for such a company? It turns out that too. We are talking about an amount that, for example, would allow to increase the revenue that Netflix estimates will achieve in the current fiscal year by about 4%.
Netflix account sharing fees for now for selected
Cowen & Co. adds that half of those who do not pay a subscription will decide to take such a step after Netflix introduces an appropriate ban (some will become “sub-members”, some will opt for a new account and a separate subscription).
And here, of course, you can start a discussion about how optimistic these assumptions are. Because there is no shortage of opinions of other analysts (even from Benchmark Co.), who speak in a slightly more subdued way and do not bode here such a large increase in revenues for Netflix. From the opinions of users and comments appearing on the web, it can also be concluded that this is not a solution after which they will rush to pay the subscription. It’s just that, as usual, mainly opponents of the new idea speak.
Love is sharing a password. But no?
Beyond conjecture, there are also facts. Netflix account sharing fees have so far been introduced in three countries – Chile, Peru and Costa Rica. Besides, Netflix subscriber growth has slowed noticeably, mainly in major markets such as the United States. Revenues therefore do not grow as before and you have to look for alternative solutions.
In addition to the increases (which have already appeared this year in North America and the United Kingdom), Netflix sees a good chance in the thorough enforcement of its own regulations. And this one says that account sharing is only possible between people living in the same household.
o what, Netflix bad? Or maybe he just claims his own, and the problem is only due to the fact that for years he did too good uncle? A tweet from a few years ago has already been pulled out, in which “Love is sharing a password” was raised.
But as you know from love to hate one step, so it is possible that some will make it towards the competition. For Poles, this is a good moment because HBO Max debuts with us, and soon also Disney+, so disappointed Netflix will also be able to choose from new products. Or spend time on something more constructive than compulsively devouring TV shows.