CNBC reported on the 19th (local time) that Netflix, the world’s largest online video service (OTT), has decided to charge for shared accounts estimated to be in more than 100 million households around the world.
In a quarterly letter to shareholders, Netflix said it has tolerated account sharing during subscriber growth, but plans to charge for shared accounts, saying the situation has changed, with the number of subscribers decreasing for the first time in 11 years.
Netflix estimates that more than 100 million households worldwide share accounts of other paid members, with 30 million households accessing content through account sharing in the United States and Canada alone.
Netflix said it has been experimenting with ways to charge additional fees for sharing accounts with people who do not live in the same household, adding that it can expand this.
It also hinted that it could start charging for shared accounts as early as next year, but did not explain specific measures.
Earlier last month, Netflix said it allowed up to two additional account sharers who do not live together for an additional fee in Chile, Costa Rica, and Peru. Additional fees are $2.97 in Chile, $2.99 in Costa Rica and $2.11 in Peru.
Netflix has been building an image of a customer-friendly brand, and its generous stance on account sharing has also been evaluated to have contributed to the creation of such an image.
However, Netflix explained that sales growth is in trouble as the household penetration rate is already relatively high and competition in the OTT market intensifies.
On the same day, Netflix announced that as of the end of the first quarter, the number of subscribers decreased by 200,000 from the previous quarter, marking the first drop in subscribers since 2011.
Initially, Netflix expected an increase of 2.5 million paid members, while Wall Street analysts suggested an increase of 2.7 million.
However, 700,000 subscribers in Russia disappeared as Netflix suspended Russian services after Russia’s invasion of Ukraine.
Netflix predicts that the number of subscribers will also decrease in the second quarter, reaching 2 million.
Netflix has 221.6 million subscribers worldwide at the end of the first quarter.
