Crackdown on shared accounts has an immediate effect, Netflix's new subscriptions soar.
According to statistics from research firm Antenna, in the first four days after Netflix stopped password sharing from May 23 to 28, the streaming company added an average of 70,000 new subscribers per day in the United States. On two of those days, the number of new registrations across the country exceeded 100,000. Due to limitations in data collection channels, the actual number of new subscriptions may be much higher than this.
According to a research report released by Antenna, a research company, on Friday, June 9th, after cracking down on password sharing, Netflix's subscription numbers have surged.
According to the company's statistics, in the first four days after Netflix prevented customers from sharing passwords from May 23rd to May 28th, the streaming company added an average of 70,000 new subscription customers per day in the United States, with two days exceeding 100,000 new registrations nationwide.
Antenna stated that compared to the average level of the previous 60 days, new customers increased by double during these four days. This is the best performance Antenna has tracked in this data since four and a half years ago. At the same time, the number of users who cancelled their subscriptions has also increased, but not as much as the number of new registered users.
Antenna collects data from multiple channels, including credit card receipts and bank records, but does not include bundled sales records. Some analysts believe that this means that the company's statistics on new subscriptions may be significantly lower than the actual number.
After last year's slowdown in user growth, Netflix has been taking measures to increase revenue. In November, Netflix launched a cheaper, ad-supported subscription option and began cracking down on password sharing.
Netflix estimates that as many as 100 million households worldwide use its service without paying. Before launching the password sharing crackdown in more countries/regions, including Spain and Australia, the company tested methods to limit password sharing in Latin America.
Netflix lost subscribers for two consecutive quarters last year, which was the first time in its history. In the past few quarters, its subscription customer numbers have started to grow again, but the growth rate is much slower than in the early stages of the COVID-19 pandemic. Although Netflix's internal researchers discovered a major loophole in which its passwords could be shared by users as early as 2019, the company has postponed cracking down on password sharing for years.
In the first quarter shareholder letter, the company stated that account sharing "undermines our ability to invest in and improve Netflix content products and develop our business."
Since the password sharing crackdown took effect on May 23rd, Netflix's stock price has risen by about 13%.
