Netflix Password-Sharing Rules Having Record-Setting Impact on American Subscriber Acquisition
Netflix Password-Sharing Rules Having Record-Setting Impact on American Subscriber Acquisition
It was inevitable that once Netflix unveiled its plans to curb password-sharing in the United States that there would be significant pushback from customers who had been led to believe that “Love is sharing a password.” After all, when the world’s largest streamer rolled out similar efforts around the world, it was met with a nearly universally negative response.
However, late last month, the streaming giant announced that it would finally be expanding its efforts to the U.S. after a series of false starts that undoubtedly hampered the company’s efforts earlier this year. While public opinion of the move was always destined to be rooted in anger, the company pointed to a positive economic impact when the rules were introduced in Canada as the best corollary to how they would be received domestically, and — according to a new report from research firm Antenna — Netflix was right.
Since the streamer announced its new password-sharing rules on May 23, Netflix has experienced its four single-largest U.S. customer acquisition days since Antenna began measuring that particular statistic in late 2018. In fact, based on the currently available data, the streamer saw nearly 100,000 signups on both May 26 and May 27.
(Click to expand the graph and see the data full-screen.)
The average daily signups for the service in the period since the announcement has been at 73,000 customers per day, which is a 102% increase over the previous 60-day average. What is perhaps even more impressive about these totals is that the spikes have far exceeded the totals Netflix achieved in the early days of lockdowns from the COVID-19 pandemic, when streaming went from a way to watch TV and movies to the way to watch TV and movies.
Of course, there is always another side to the analytical coin in cases like this, as Netflix did see an increased number of cancelations since the announcement as well; however, not nearly enough to counteract the signups. According to Antenna, the signup-to-cancellation ratio since May 23 is up 25.6% over the previous 60-day period.
Related: Answering Important Questions About Netflix's New Password-Sharing Rules
A recent study indicated that roughly 40% of American Netflix users could potentially be left without access to the service with the implementation of these new rules. However, with an estimated 100 million users accessing the platform without a subscription, Netflix clearly views its efforts as being ultimately beneficial, especially as the entire industry is becoming hyperfocused on average revenue per user (ARPU) as opposed to solely looking at subscriber totals. Estimates indicate that the streamer could increase its bottom line by $5.5 billion by 2027 thanks to its moves to minimize password-sharing.
Netflix
Netflix is a leading subscription-based video streaming service that offers on-demand access to an extensive library of over 3,000 movies, 2,000+ TV shows, and a growing collection of acclaimed Netflix originals. Renowned for producing groundbreaking content, Netflix has become a cultural powerhouse with hit originals like “Stranger Things,” “Wednesday,” “Squid Game,” “The Crown,” “Tiger King,” “Bridgerton,” “The Witcher,” and “Black Mirror.”