Netflix exodus: Reports of 1 million lost users after password-sharing crackdown

Could the recent password-sharing crackdown backfire for Netflix? The company has been publicly committed to start charging account holders for each user they share their password with outside of their household. 

According to a report by market research group Kantar, Netflix lost over one million users in Spain alone after launching its password-sharing crackdown there. The crackdown doesn’t do away with password sharing altogether; it lets users share an account with other households for an extra fee.

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Netflix customers in Spain started seeing an added fee to their accounts in February, when they were charged an additional €5.99 for sharing log-in information with people in other households, on top of the subscription fee.

It wasn’t all lost revenue, however: About two thirds of the Spanish users that bailed on Netflix were ones that were using a shared account that someone else was paying for.

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This doesn’t make the loss inconsequential, however. Over 600,000 lost users means 600,000 fewer people watching new content, even if they weren’t paying for an account; it means 600,000 fewer users commenting about content online, writing reviews, recommending new shows, etc.

Reportedly, roughly one third of the one million lost users were paying customers with their own accounts.

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All in all, Netflix saw the number of subscription cancellations triple during the first quarter of 2023. With the plan just having launched in February, it wouldn’t come as a surprise if more users cancelled their Netflix accounts. Kantar reported that 10% of remaining subscribers were planning on canceling their subscriptions in the second quarter of 2023.