Netflix Tests Monetising Password Sharing In Latin America
American Over-the-top (OTT) subscription streaming service and production company, Netflix, has announced that users from five Latin American countries, - Dominican Republic, El Salvador, Guatemala, and Honduras, would be required to pay an additional fee for using their Netflix account outside of their registered home address.
The platform has introduced a new feature for users in the five Latin American companies, which allows them "to add a new home" to their accounts, announced Chengyi Long, Director, Product Innovation, in a blog post.
The additional fee has been priced at USD 1.70 for users in Argentina, and USD 2.90 for users in the Dominican Republic, El Salvador, Guatemala, and Honduras.
Netflix had previously announced a shift in strategy, by pivoting towards an aggressive ad-based revenue generation model, something that the company had traditionally steered clear of. “Those who have followed Netflix know that I have been against the complexity of advertising and a big fan of the simplicity of subscription. But as much as I am a fan of that, I am a bigger fan of consumer choice, and allowing consumers who would like to have a lower price and are advertising-tolerant to get what they want," Reed Hastings, Co-CEO, Netflix, had said in April.
The proposed additional fee, which is an attempt to monetize the common practice of sharing passwords, comes on the back of the company reporting a loss of subscribers for the first time in over a decade.
In March 2022, the company had announced an “add a member” option on the platform for users from Chile, Costa Rica and Peru, where users could create a sub-account for a maximum of two people they don’t live with, in exchange for a fee.
“It’s great that our members love Netflix movies and TV shows so much they want to share them more broadly. But today’s widespread account sharing between households undermines our long term ability to invest in and improve our service,” the company said in the blog post.
