How Netflix Solved Its Password-Sharing Problem

Netflix added 22 million subscribers in 2023 from its password-sharing crackdown.
May 29, 2024
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netflix users with 3 marked as cancelled


“Can you share your Netflix password?” Before the streaming wars, it was a simpler time when sharing a Netflix account felt like sharing a piece of your world.

It also made for hilarious Reddit posts when Becky found out her middle school ex was still using her account ten years after they broke up.

Netflix’s password-sharing crackdown has been an enormous success. It helped add ~22 million subscribers in 2023, per Fast Company.

In an interview with Bloomberg, Greg Peters, Co-CEO of Netflix, revealed how they did it:

  • Netflix built a computer model to differentiate between when someone travels to another country vs. when someone uses their friend’s account
  • Tested two methods to make freeloaders pay: 1) pay per household (like cable did), or 2) current customers can buy an extra membership to their primary subscription for $7.99/month
  • Ran A/B test in Latin American countries where password-sharing was “most widespread”

They found method #2 performed better and reported seeing more signups, fewer cancellations, and less online rage.

Now, if they can just fix their content library…god knows it’s been months since I’ve found a show worth binging on the platform.

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