Netflix May Soon Clamp Down On Password Sharing: Here's How It Is Going To Work

One of the biggest concerns for the streaming giant has been to control the rampant practice of password sharing. The company says over 30 million households in the U.S. and Canada use shared passwords for accessing Netflix. The global tally is at 100 million households. 

Netflix has allowed its users to share their passwords with relatives and friends. During its quarterly meeting, the company said that this policy likely helped fuel its growth by "getting more people using and enjoying Netflix. 

In 2017, Netflix's corporate account tweeted in support of the practice. 

Love is sharing a password.

— Netflix (@netflix) March 10, 2017

No, Netflix will not freeze those shared accounts; instead, the company will set an extra fee for accounts being used by multiple people outside the home.

The company has rolled out two test features called "Extra Member" and "Profile Transfer." Both of the features are currently being tested in Chile, Costa Rica, and Peru.

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The costs vary based on several factors, but Netflix said the features can be added for "a fraction of the price of a Basic Plan."

With the "Extra Member" feature, subscribers to the standard and premium Netflix plans can add an account for up to two people who don't live with them.

These "extra" members will have full access to the main Netflix account and have their own profiles and log ins.

The "Profile Transfer" option lets subscribers at any price-tier transfer their profile information, namely their viewing history, to a new paid account.

A survey from research organization Time2Play finds that about 80% of Americans who use someone else's password wouldn't pay for their own subscription.