Netflix really wants people to know that password sharing isn’t allowed anymore. The extent to which it’ll enforce its new rules is another matter.
Despite widespread reports that Netflix will begin “blocking” users who regularly stream from outside the home, the company has not yet committed to a timeline for cutting people off. For now, account holders will receive warnings to stop their password sharing, along with options to either move the other user onto their own account or pay extra on their behalf.
These measures are now rolling out for U.S. users after months of testing in select markets, but calling them a “crackdown” isn’t quite accurate. For now, at least, sharing your password is still technically possible; it’ll just become more annoying to do so.
Netflix’s “paid sharing” push
To be clear, Netflix’s terms of service say that password sharing with anyone outside your household is against the rules without paying extra. If your child is away at college, for instance, Netflix now expects them to have their own account or to be part of a “paid sharing” plan.
Those paid sharing plans cost $8 per month in the United States. Account holders can add one extra user on Standard ($15.49 per month) plans, and up to two users on Premium ($19.99 per month) plans. Alternatively, Netflix offers a profile transfer tool for users who want to set up their own accounts while keeping their watchlists and recommendations.
To detect password sharing, the company says it will use a combination of factors such as IP addresses, device IDs, and “account activity.” While this type of location detection has caused some issues in the past (most notably with Hulu + Live TV on T-Mobile’s home internet service), Netflix says it doesn’t anticipate any problems using the service with 5G home internet providers.
Netflix does make accommodations for things like extended work trips or second homes. On TV devices, heading to Get Help > Manage Netflix Household will bring up options to set or update your home location. You’ll then get a code via email or text message to confirm the change. For regular vacations, users will be able to access the service for an unspecified period of time without running into any warnings, even on TV devices.
Users who operate multiple Wi-Fi networks could run afoul of the rules, though. A page on Netflix’s help site says the company “may” associate only one of those networks with the user’s Netflix Household.
Cracks in the Netflix paywall
As for what happens when you break Netflix’s new password sharing rules, that’s where things get murky.
MoMo Zhou, a Netflix spokesperson, confirmed that the company is not currently blocking users suspected of password sharing, as the company wants to give people time to consider their options. Asked when Netflix would prevent password sharers from accessing the service outright, Zhou declined to provide a timeline.
Also unclear is whether Netflix will try to cut off users who only access the service on computers or mobile devices. Netflix will not comment on how mobile sharing will work in the United States, but in test markets, users have found they can stream on non-TV devices without restrictions.
Meanwhile, the ability to change your home location presents its own kind of loophole. At present, Netflix is not specifying a limit on how many times people can switch home locations. If Netflix starts blocking users suspected of sharing a password, far-flung family members could theoretically set up a shared email address and help themselves to authentication codes whenever they need access.
Netflix’s next steps in discouraging password sharing
The point here is not to encourage brazen terms-of-service violations, but to illustrate the mess Netflix has stepped in as it searches for more money.
Until now, Netflix only limited usage based on simultaneous streams, and while this wasn’t the best way to prevent password sharing, at least the rules were easy to understand. Limiting usage by location raises lots of extra questions and leads to all kinds of unusual edge cases, some of which might inconvenience legitimate customers.
So, while Netflix is publicly talking tough about password sharing, it’s applying a lighter touch to the actual enforcement. With no shortage of competing services—none of which have the same restrictions—Netflix does not want to outrage legitimate users and create a big backlash. The company even delayed the rollout of new password sharing rules to the U.S. after taking criticism for its confusing policies elsewhere.
That doesn’t mean Netflix will always take a lenient approach toward password sharing, but it’s clearly in no rush to wield more draconian countermeasures, such as blocking users outright. If the goal is to eke out a little extra subscription revenue, scare tactics might be enough.
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Author: Jared Newman
Jared Newman has been helping folks make sense of technology for over a decade, writing for PCWorld, TechHive, and elsewhere. He also publishes two newsletters, Advisorator for straightforward tech advice and Cord Cutter Weekly for saving money on TV service.