Netflix has more than 200 million subscribers around the world, and now the company is looking at ways to curb password sharing for both business and security reasons. A new feature, first spotted by GammaWire, prevents people who are not authorized to use the account from accessing it. A Netflix spokesperson told The Verge, “This test is designed to help ensure that people using Netflix accounts are authorized to do so.” If Netflix detects that someone is trying to use the account without being an account owner, they’ll be asked to verify later or verify being an account owner through an email code or text code.
If someone is unable to verify account ownership within a certain timeframe, they won’t be able to stream any Netflix content. Instead, they’ll be asked to make their own account. While this may not prevent all password sharing — hypothetically, an account owner could send their friend the code as it comes through — the idea is that it will prevent some password sharing. The test, which isn’t specific to any one country for any specific length of time, is also being rolled out to try to better security measures around account protection. If there’s a malicious attempt to use an account for which someone may have gained a password through fraudulent methods, they won’t be able to access the account.
One of the biggest questions Netflix subscribers might have is what constitutes a household account. Netflix’s terms of service state that streaming content on the platform is “for your personal and non-commercial use only and may not be shared with individuals beyond your household.” That may mean a physical household, but the terms of service aren’t super clear. Families with kids away at college or living in different states may sign up for the family plan, for example. That’s one scenario that co-CEO Reed Hastings specifically spoke about in 2016. “Password sharing is something you have to learn to live with,” Hastings said. “There’s so much legitimate password sharing, like you sharing with your spouse, with your kids, so there’s no bright line, and we’re doing fine as is.”
Now, however, it seems like Netflix’s teams are trying to figure out a way to combat some password sharing while also addressing tighter security measures. Password sharing has long been a concern posed by analysts and investors in the space. Analysis from Parks Associates estimated that password sharing and piracy cost companies in the streaming space around $9 billion alone. While Hastings alongside other entertainment executives have shrugged it off as something that companies have to contend with, it appears that things are beginning to change.
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