Netflix Takes Aim at Account Sharing: Implications for UK Telecom Bundles

Netflix, Inc NFLX discussed with U.K. telecoms groups that use the American media company as part of bundled TV content ahead of a crackdown on account sharing likely in May.
Netflix has voiced how the unrestricted use of its platform has hampered its ability to invest in new TV and films and plans to start warning customers over account-sharing violations, Financial Times cites familiar sources.
Companies like Sky, BT, Virgin Media, and TalkTalk offer Netflix as part of bundled deals on broadband and TV content.
After crackdowns in Canada, New Zealand, Spain, and Portugal in the first quarter, Netflix found that its new "paid sharing" service had resulted in a "cancel reaction" that led to lower membership growth.
Once the account-sharing crackdown kicks in, Netflix proposes to urge customers to set a primary location, implying that anyone in their household can use their Netflix account. In case of violation, Netflix proposes to email the subscriber about the extra usage.
To turn the non-subscribers into paying customers, Netflix looks to launch such warnings across most of its major markets, including the U.S. and the U.K.
Netflix in April estimated that more than 100 million households shared accounts with other users worldwide.
Netflix had to postpone the crackdown from the first to the year's second quarter.
But Netflix said subscribers soon started adding "extra member" accounts after the initial drop-off, boosting revenues.
Price Action: NFLX shares traded lower by 1.13% at $332.10 on the last check Tuesday.
Photo by Stock Catalog via Flickr

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