It’s finally happened. After testing in some South American countries last year and introducing it into New Zealand and Canada earlier this year the Netflix Password Sharing crackdown is happening here in Australia.

Netflix has announced that Australian users will need to get their own accounts and stop sharing their password with friends and family who don’t live in the same household as the company’s strict enforcement of their longstanding terms and conditions kick in.

In updating their plans and pricing, Netflix today say “Starting today, we will be sending this email to members who are sharing Netflix outside their household in Australia. 

The T&C’s state that “The Netflix service and any content accessed through the service are for your personal and non-commercial use only and may not be shared with individuals beyond your household unless otherwise allowed by your subscription plan.  and it has said that for many years now, though not since the very start.

A clearer statement of this can be found on the company’s pricing page – saying “A Netflix account is for people who live together in a single household”.

The new Pricing plans reflect these changes, with the set of plans remaining the same, however Standard ($16.99) and Premium ($22.99) account holders will have a new option of adding an “Extra member” to their account.

An Extra Member account will cost $7.99 – and give the user access on a single screen in that second household, but at the HD or 4K resolution of the main account. Importantly, that “Extra Member” is not billed directly, instead, their membership is paid for by the main household account.

Anyone using your account that is not at your home will get a notice that they are not in the primary household when they try and log in:

This brings an end to the grandparents sharing your password, and the kids who left home sapping off mum and dad’s account.

Netflix wants you to pay MORE

The simple fact is, this is about Netflix getting cash from every viewer.

So in the case of my Mother-in-Law, who uses our Netflix account login and password, Netflix want her to get her own account.

But they’re offering a lower cost option of becoming an “extra member” in our account at a lower price.

Bottom line – they get money and much more of it.

Password Sharing is bad for Netflix’s business

This is all happening because of the stock market pressure on Netflix to grow and increase revenue.

Earlier this year there was a backlash on social media to the changes, but – it seems that’s ok with Netflix. The company recently told shareholders “we see a cancel reaction in each market when we announce the news, which impacts near term member growth. But as borrowers start to activate their own accounts and existing members add “extra member” accounts, we see increased acquisition and revenue.”

While the system had not yet rolled out in places like Australia or USA, it’s clear each new market where the password sharing crackdown occurs is a good growth area for Netflix – the company says
“For example, in Canada, which we believe is a reliable predictor for the US, our paid membership base is now larger than prior to the launch of paid sharing and revenue growth has accelerated and is now growing faster than in the US.”

The problem with their pricing plans

Netflix has four plans in Australia, Standard with ads, Basic, Standard and Premium.

The Premium plan is the ONLY plan that streams video in 4K, meaning a single person wanting 4K has to pay for the privilege of watching on up to 4 screens, just to watch 4k content on their own.

This is one of the reasons people share their passwords. But no more.

What is an Extra Member?

An Extra member is a new user, with their own username and password, their own Netflix account, but it’s paid for on your primary account.

So my mother-in-law, can get Netflix for less than $10, but it has to be on my account and I have to pay.

Those Extra members can only watch on 1 device at a time.

Standard and Premium plans are the only ones which allow for an Extra member, with Premium getting two extra member accounts if desired

What if I’m travelling?

Netflix say you can use your Laptop or iPad outside of home as long as it logs into home once a month.

That means you just open Netflix on your device before you go and enjoy.

It also means if your “extra member” is only using an iPad, they can keep it running by brining the device to you once a month.

How hotel room TVs fit into this I don’t know yet, but I’m sure it won’t take long! Netflix’s own announcement about password sharing says “Members can still easily watch Netflix on their personal devices or log into a new TV, like at a hotel or holiday rental”

Can I avoid the new Netflix Password Sharing crackdown?

No sorry, this is the way it is, and frankly, other companies may follow soon.