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Feb. 16, 2024

Streaming Giants Enter Password Crackdown Era

As the streaming landscape undergoes a transformative shift, Disney+ and Hulu have recently joined the ranks of platforms cracking down on password sharing, taking cues from the game-changing strategy pioneered by Netflix. By: Wee Yan Ling

In an attempt to curb the practice of password sharing, Disney+ and Hulu have scheduled to implement stringent changes in their subscriber terms as they explicitly forbid users from sharing log-in details with individuals existing outside of the primary household. These changes will take effect from 14 March for existing subscribers which marks a notable shift in the streaming landscape, reflecting the industry trend led by Netflix.


The move comes after Netflix reports their unparalleled growth with a prominent increase in the new subscriptions which is attributed to its strategy, password-sharing crackdown. 


The CEO of Disney, Hugh Johnston had just addressed investors as he unveiled Disney’s take to fight against improper password sharing. Beginning this summer, Disney+ accounts suspected of such practices will receive new capabilities enabling borrowers to commence their new subscriptions. Later in 2024, Disney+ account holders who share the access with individuals outside the same household will be able to continue the practice with an additional cost. This move strives to convert freeloaders into paying customers. 


In the latest quarter of 2023, Disney+ has been revealed to be struggling as it lost a net $1.3 million subscribers in its core market. The contraction was linked to its increase in price enacted in the quarter. However, Disney anticipates a significant rebound in the current quarter ending in March with an estimated increase of between 5.6 to 6 million subscribers to “Disney+ core.”

Drawing inspiration from the success of Netflix, Disney is positive about the paid-sharing initiatives’ potential benefits as they are expecting a significant improvement in the later half of the year. The company’s goals is to maximise their audience reach, elevate their customers’ experience overall as well as to grow their subscriber base exponentially. 


Netflix, the trailblazer in the streaming industry has reported a significant increase in sign-ups at the end of 2023 which was fuelled by its strategy of password-sharing crackdown. It has added more than 13.1 million subscriptions in three months ending December. The streaming giant has displayed their trust in its growth trajectory and has intentions to increase their pricing plans. 


The global success of Netflix in the 12 countries offering advertisements, in which 40% composed of new sign-ups, has added an ironic twist to its historic resistance against advertisements. The streaming giant was the first to tackle the password-sharing practice as they acknowledge its impact on the company’s bottom line. Despite being met with loads of scepticism from the start, it had set a precedent for the industry as other streaming services are following suit. 


The Hulu, Disney+ and ESPN+ trio has now joined the ranks of platforms tightening security as they forbid users from sharing passwords with those outside the same household. As the industry embraces a new era of password crackdowns, the impact of subscriber counts and the overall streaming experience remains a subject of keen observation and analysis.


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