As Netflix rolls out its crackdown on password sharing, new research from Samba TV and HarrisX shows that among subscribers, the younger generations are more likely to cancel the service because of the new enforcement.
Last week, the world’s largest streaming service began to crack down on password sharing in the U.S., a policy that it has been promoting for almost a year. In an effort to recover billions of dollars in revenues it says it loses annually, Netflix is no longer allowing subscribers to share their passwords to access the service to anyone outside their households. When a suspected scofflaw in the U.S. now attempts to access a Netflix account outside their ISP, they get a notice directing them to subscribe to Netflix’s $7.99 ad-supported streaming tier.
This has spurred predictable outrage on social media and a spike in “cancel Netflix” Google searches, according to BGR. Although the crackdown wasn’t the only factor—other complaints revolved around content quality and series cancellations—it was obvious that forcing subscribers to pay up for additional subscriptions has stirred a hornet’s nest (despite the seemingly illogical “spite” factor in cancelling a service just to get back at the company).
That spite factor seems to be most predominant among Netflix’s youngest subscribers. In the survey—conducted by HarrisX in late March among 2,506 Americans—37% of current Netflix subscribers would cancel their account if they could no longer share their password with people outside their home. 52% of Gen Z and 51% of Millennials would cancel their account, but only around a quarter of Gen X and Baby Boomers would do so.
In Netflix’s favor however, data showed that of those who currently use someone else’s Netflix account, 64% would subscribe to Netflix if they could no longer use someone else’s password (39% to an ad-supported tier and 25% to an ad-free tier). 76% of Millennials and 75% of males would subscribe, compared to only 55% of females.
Other findings include:
- Account sharing has risen; a slight majority (51%) share their account with others.
- 49% of Netflix subscribers share their subscription with someone else and 48% of Disney+ subscribers share their subscription with someone else.
- Most share their account with family members in the household.
- Of those subscribed to at least one platform, 60% of those with a streaming subscription share their password with someone else. This includes 79% of Gen Z and 74% of Millennials, compared to 52% of Gen X and 38% of Baby Boomers).
- Of those who share passwords, 57% share with 1-2 people. Millennials are more likely to share with more people. Of those who share subscriptions, Millennials are the most likely generation to share with at least 3 people (34%, compared to 25% of all people who share subscriptions).
- 7 in 10 adults who share and borrow access to streaming services say that Netflix is a platform they are most likely to share with others.
- More than 4 in 10 people would be willing to pay more to share their account with someone outside of their home.
- Of those who would be willing to pay to share their account, 41% would pay up to $10 per month and an additional 10% would pay up to $15, accounting for just about half of those who would be willing to pay extra.
- Males and Millennials are most likely to be willing to pay more.
- The password crackdown may spur cancellations of the service, particularly among younger demographics like Gen Z.
- 37% of current Netflix subscribers would cancel their account if they could no longer share their password with people outside their home. 52% of Gen Z and 51% of Millennials would cancel their account, but only around a quarter of Gen X and Baby Boomers would do so.
“Data from Samba TV and HarrisX shows the crackdown on password sharing has the potential to hasten the growth of Netflix’s ad-supported tier as sharers are gently forced to migrate to their own accounts," said Samba TV CEO Ashwin Navin. "Of those who currently use someone else’s Netflix account, almost 40% say they’d move toward the cheaper monthly subscription with ads, while only a quarter may sign up for their own ad-free experience.”
“There's also an opportunity for Netflix to charge for these additional users. 4 in 10 subscribers say they’d pay up to an additional $10 per month to share their account with someone outside of their home. Implementing this new fee could quickly grow Netflix’s subscriber revenue.”
“Most subscriber losses due to password sharing are likely to come from younger generations. Our research indicates more than half of Gen Z and Millennial subscribers are likely to cancel their accounts if they are no longer allowed to share passwords. This is roughly double the percentage of Gen X and Boomer subscribers who say they’d do the same.”
