Perhaps you thought it was a checkmate against Netflix worthy of Beth Harmon herself? Why spend on a monthly if someone slipped you their password, and even built you a little “who’s watching” icon? But as the Associated Press reported on Friday, streaming services that have long accepted this loss of potential revenue may soon cease looking the other way.
While Netflix and Disney+ both announced recent $1 monthly increases in fees, streamers are now faced with, to put it bluntly, figuring out a way to get more dough without pushing too hard.
With “several billion” dollars at play because of password sharing, the streaming industry is now at the “not if, but when” stage of clamping down, according to analysts. Costs are rising in the arms race to retain subscribers, like Amazon throwing down $465 million on a single season of Lord of the Rings, and many of the big streamers, despite their cultural footprint, have yet to pass their break even threshold. It is estimated that 56 percent of online adults aged 18- to 29 are engaged in some kind of password swap or sharing. That’s simply too much loose change. The days of sending a quick text to a friend to watch that one thing that’s trending are likely to come to an end.
So how would the crackdown work? Some Netflix users got hit with a trial run in March. When accessing the app, they were asked to verify their account, by entering a code via email or text. Simple enough to do if you are on the couch and your smartphone is right next to you between the remote and a tub of Orville Redenbacher. This is a little more difficult, however, if your pathway to The Crown is from someone you dated last year, but you ended it on good enough terms that they never bothered to change their code.
Complications arise, however, with family members sharing a plan, which many streamers encourage in their marketing. The AP story quotes Disney’s former CEO Bob Iger from the Disney+ launch, saying “we expect families to be able to consume it – four live streams at a time,” but suggesting that they have “tools to monitor” when password sharing gets overzealous.
As Consumer Reports notes, the terms of service can be frustratingly vague. HBO’s reads “we do not encourage password sharing outside of that household.” There is a wide gap between a lack of encouragement and prohibition.
The recently launched Paramount+ has, buried in its terms and conditions, language stating that subscribers “must not permit use of your account by anyone other than members of your household.” Of course, “household” is a bendable word. If you spend a week at an AirBnB up in New Hampshire, you should be able to dial up your favorite shows. But if your kid is off at college for a semester? What would Paramount+’s Captain Picard do? He’d sigh and reach for his Discover card.
More Great Stories From Vanity Fair
— A First Look at Leonardo DiCaprio in Killers of the Flower Moon
— 15 Summer Movies Worth Returning to Theaters For
— Why Evan Peters Needed a Hug After His Big Mare of Easttown Scene
— Shadow and Bone Creators Break Down Those Big Book Changes
— The Particular Bravery of Elliot Page’s Oprah Interview
— Inside the Collapse of the Golden Globes
— Watch Justin Theroux Break Down His Career
— For the Love of Real Housewives: An Obsession That Never Quits
— From the Archive: The Sky’s the Limit for Leonardo DiCaprio
— Not a subscriber? Join Vanity Fair to receive full access to VF.com and the complete online archive now.
