It has been nearly two months since Netflix introduced their new crackdown on password sharing to Australia following on from New Zealand, Canada and some South American countries earlier in the year. Their backflip on password sharing has seemingly achieved the desired outcome with an increase in subscribers according to an earnings release this week.
According to the release Netflix ended the recent quarter with 238 million subscribers and a profit, yes a profit, of $US1.5 billion (remember that when they cancel your favourite show). This profit was posted with an actual revenue less than expected of $US8.2 billion for just the second quarter of this year (April to June) which caused their share price to drop more than 8 percent.
To convert non-paying users to subscribers Netflix added shared accounts where extra family users can be added to an account for an extra $8 per month. They also launched an ad-supported subscription level at $6.99AU, set to replace the Basic plan as that is phased out.
The next few months will be interesting to sit back and watch given Netflix’s password sharing crackdown and the strikes by both the writers and actors especially with the strike looking like no end in sight with one executive quoted as saying:
“The endgame is to allow things to drag on until union members start losing their apartments and losing their houses”
It remains to be seen how many of these new subscribers will continue with Netflix, especially given the lack of new content that will be coming due to the strike, but initial results are positive for them with such a large increase in a short time.
