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LONDON: Netflix warned broadband and telecom companies that its crackdown on password sharing could lead to backlash from customers.
The streaming giant held talks with some of the UK’s leading telecom companies and other media groups that use Netflix as part of bundled TV content to alert them of potential consequences as it prepares to enforce rules limiting how subscribers can share their accounts with others.
The talks are designed to help operators prepare for a potential wave of complaints from customers who may be unhappy with Netflix’s plans to crack down on password sharing.
According to multiple sources, the Californian SVOD is expected to tighten its grip on password sharing within the new few weeks as it hopes to increase profitability amid slowing rates of new subscriber growth.
Netflix in April estimated that more than 100 million households around the world shared accounts with other users.
The Financial Times reported on Tuesday that Netflix “had sought to ensure its partners were kept informed about its plans as they progressed over the past few months,” as it expects heaps of customers who have grown accustomed to sharing passwords to complain to their providers.
Although exact details have yet to be made public, people close to the matter anticipate that once the account-sharing crackdown begins, customers will be encouraged to set a primary location.
Netflix account holders will be able to share their accounts with anyone in their household, but if someone tries to use the account from outside the primary location, the account holder will be notified about additional charges.
When traveling, users can request a temporary code from the service when signing in, which will grant access to their account for seven days.
Netflix expanded its crackdown on password sharing to primary markets in the first quarter of 2023.
The policy, which had been tested in selected South American markets in 2022, was rolled out in Canada, New Zealand, Spain, and Portugal, with mixed results, leading the streaming giant to postpone the wider deployment after noticing a “cancel reaction.”
In Spain, the streaming giant lost 1 million members, while in Canada, Netflix said in April that it was “taking the right approach” after the number of paying users was higher than before the launch.