Netflix password sharing is bad, but it's not that bad.
That's the essential takeaway from a new Leichtman Research Group (LRG) survey of 4,400 U.S. households, which found that 33% of Netflix users share an account.
The data conflicts with another recent survey of 10,400 adults, conducted by the Advertising Research Foundation, which found that 49% of subscribers share their Netflix password with someone living outside their home.
LRG's Internet-Delivered Pay-TV Services 2022 study breaks up that 33% of password sharers with the following behavior classifications. Editor's note: We made some clarifications after speaking to Leichtman principal Bruce Leichtman on Wednesday morning:
> 15% of Netflix services "are used and paid for by those that also share them with someone outside the household." These are the paid subscribers who do the sharing of their passwords with folks outside their home.
> 15% of Netflix services "are used in one household but are borrowed from another household that is paying for the service." These are the non-paying people who "borrow" the Netflix account of someone not living with them (aka the freeloaders).
> 3% of services "are used by multiple households that share the subscription cost."
> 3% of Netflix services "are not paid for because they come with another service."
The issue of Netflix password sharing has come up quite a bit of late, following Netflix's disclosure two weeks ago that it's testing in Latin America a new billing scheme that adds around $3 to the monthly bill for subscribers who share their Netflix password.
Of course, password sharing is endemic to other direct-to-consumer streaming services. Overall, 29% of DTC subscriptions are shared with users outside the home.
“Password sharing is an inherent feature of most streaming services," said LRG principal Bruce Leichtman in a statement. "Sharing helps to expand the user base and retain customers, but it also creates a gap between the number of households that have a service and actual paying subscribers. For example, about two-thirds of U.S. households report having Netflix, but this includes about 10% of U.S. households that don’t pay for the service because it is borrowed from someone else’s subscription.”
Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. You can start living a healthier life with greater wealth and prosperity by following Daniel on Twitter today!
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