Signs point to Disney+ joining Netflix in a password-sharing crackdown

Watch out, password sharers. Disney+ might become the next streaming service to monetize a practice largely tolerated by the industry–at least until Netflix’s recent declaration that it would target 100 million viewers worldwide using its service for free.

Like Netflix, which says it could take a year before the company seeks $3 monthly payment from out-of-household users, Disney seems eager to first gauge public reaction. In a recent questionnaire posted on Twitter, parent company Disney asked Spanish subscribers why they share Disney+ passwords with people who are not part of their household.

Beyond the obvious – it’s cheaper that way! – respondents also said they don’t use the service enough to justify the expense, and that essentially they part of an informal cabal of password-sharers to exchange access to multiple streaming services.

Netflix, after losing 200,000 subscribers worldwide in the first quarter, at least can make a hardship case. Disney+ gained 35 million subscribers in 2021. In the U.S., a Disney+ subscription, at $7.99 a month or $79.99 per year, allows seven profiles with no more than four simultaneous streams. The terms of use forbid password sharing.

A Netflix Premium subscription, $19.99 a month, allows four screens at once within the same household. Until now, out-of-household sharing has been inconsequential. Netflix estimates 100 million households participate in password sharing. A Kagan Consumer Insights survey found 11 percent of Netflix users admitted using a shared account.

Here’s what Netflix and others might face: A new Aluma survey of more than 2,200 U.S. adult broadband users – which include 1,315 Netflix users – found 13 percent of adult Netflix users would cancel the service. And 12 percent would likely add at least one out-of-household user at Netflix’s $3 rate.

“We’ve just got to get paid for them to some degree,” Netflix founder and CEO Reed Hastings said last month after the company released its first-quarter earnings.