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Netflix to charge extra for password-sharing in 5 LatAm countries from next month

In order to combat password sharing and boost revenue, Netflix will soon start testing a “add a house” service with users in five Latin American nations. netflix latam

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Netflix is taking action against password sharing netflix latam

Back in April, Netflix blamed users who share their passwords with friends and family for losing more than 200,000 subscribers in the previous quarter. According to the company, the platform today has more than 100 million users who don’t pay for a Netflix subscription.

In a note to employees, Netflix said it was aiming to crack down on password sharing – and now this is becoming a reality, at least in a few regions.

From next month subscribers in Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic will need to pay an additional cost to use their account away from their primary residence for longer than two weeks; however mobile devices, including smartphones, tablets and laptops will not be affected.


Members on the Basic plan in each country can add one extra home, while those who pay more for the Standard plan get two and Premium users can have up to three. Each additional home will cost 219 pesos ($1.70) in Argentina, where a Basic subscription is currently priced at 379 pesos per month ($2.94), and $2.99 in the other four countries where a Basic monthly plan will set you back $7.99.

A new “manage homes” tab in “account settings” will let users control where their account is being used – and remove homes at any time.

In March 2022, Netflix launched a similar “add extra member” feature in Chile, Costa Rica and Peru, charging subscribers $2.99 to add one extra user to their account, with Standard and Premium customers able to add up to two.

Although Netflix account sharing is common globally, with the company even at one time crediting it with being intrinsic to its success, it is thought to be particularly prevalent in Latin America, where the yearly cost of a subscription in relation to the average wage is higher than across North America and Europe. According to research by Comparitech(opens in new tab), a basic yearly Netflix subscription in the UK amounts to 0.23% of the average person’s income and 0.17% in the USA, but in Honduras, it equates to around 4.4%, one of the highest worldwide.

In a blog (opens in new tab)post about the new charges, Netflix’s Director of Product Innovation Chengyi Long wrote that the company was taking measures because “today’s widespread account sharing between households undermines our long term ability to invest in and improve our service”.

Earlier this year, Netflix reported significant subscriber losses for the first time in a decade, with a global net loss of 200,000 paid users in April. When the company disclosed that it was braced to lose a further two million subscribers before July, its shares dropped by more than 25 per cent, wiping more than £23bn /$30bn / AU$40.3bn off its market value, rising to around £56.5bn / $70bn / AU$99.8bn since.

Demand for streaming services is increasingly on the wane as the cost of living continues to rise across the globe. Yesterday, research firm Kantar reported that more than three million UK households have already cancelled a streaming service subscription this year, up from 1.51 million in the first three months of the year. netflix latam

Netflix has previously spoken about its plans to stem the tide and claw back revenue by clamping on those who share accounts while also partnering up with Microsoft to introduce a cheaper ad-supported tier.

While the company might not be in the rudest of health, it’s still emphatically the market leader when it comes to video on demand, with around 220 million subscribers globally.  netflix latam

 

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