Credential sharing in video-on-demand business in the U.S. - statistics & facts
Illegal downloading of movies or series is not the only problem streaming platforms are confronted with. Online services are experiencing new challenges when it comes to protecting their content due to a constantly expanding subscription-based economy. The issue many providers are now facing is the sharing of login details with family and friends – also known as account sharing. Over one in four direct-to-consumer (DTC) video service accounts in the United States were used in more than one household, according to a survey from February 2023.
Who is sharing and which services are affected?
Younger viewers tend to share login details of video streaming services the most. A survey conducted in the United States in April 2023 found that, among Generation Z, 48 percent of streaming consumers give out their credentials to someone they live with, and 30 percent share their password with someone outside their household. In comparison, 10 percent of baby boomers stated that they mooched at least one streaming platform login from someone they do not live with. According to another survey, Netflix and Disney+ were the most-shared video streaming services, with 16 percent of their viewers using an account from outside their household in 2023. But newer providers such as Paramount+ and Peacock are also affected.
To many consumers, this practice seems to be a gray area. Indeed, account sharing is not new and even helped to incite growth of streaming services such as Netflix and Disney+, as people from the same household can watch via different profiles and more viewers can use and enjoy the content. However, in the U.S., for instance, sharing passwords outside one's home is illegal according to the Computer Fraud and Abuse Act, although it is fairly widespread. A survey from March 2023 found that 11 percent of Netflix users do not subscribe to the service but use a password from someone else. Furthermore, the streaming giant estimated that around 100 million households are not paying to stream content on its platform but borrowed an account from actual subscribers.
What to do with so-called “moochers”?
Splitting subscriptions may cost providers big money. Analysis show that American video streaming operators annually loose over two billion U.S. dollars in potential revenue. After the reported net subscriber loss in the first half of 2022, Netflix could no longer ignore the so-called “moochers”, who do not pay, and started to implement an additional fee for legal account sharing. Netflix began this scheme in April 2022 in three pilot countries (Peru, Chile, and Costa Rica), where extra charges were levied upon those who allowed people outside their household to use their log-in details to watch content. This practice has been expanded to further Latin American countries that year, and in early 2023, the streaming company launched paid-sharing plans in Canada, New Zealand, Portugal, and Spain. While this strategy might help Netflix to generate more revenue, a survey held in the United States revealed that such measures could lead to subscribers canceling their accounts. Indeed, between January and March 2023, the streaming platform already lost one million subscribers in Spain due to credential-sharing curbs.
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