Netflix’s password-sharing crackdown shows promising results in US, boosting customer acquisition

Netflix’s recent crackdown on password-sharing leads to a surge in customer sign-ups, indicating a successful start to the initiative.

Netflix’s efforts to curb password-sharing appear to be paying off, as the company experienced its largest customer acquisition days in over four years, according to data from analytics firm Antenna. Despite some backlash, the streaming giant’s recent crackdown on unauthorized account sharing has yielded positive results, showcasing the effectiveness of its measures.

Starting on May 23, Netflix implemented a policy that charges US subscribers an additional $8 to add users outside their households to their accounts. The aim was to prevent unauthorized access by acquaintances, friends, or distant relatives. In the first six days following the implementation, Netflix witnessed a significant surge in user sign-ups, marking “the four single largest days of US user acquisition” in Antenna’s tracking history of four and a half years.


Antenna’s data revealed that the average daily sign-ups to Netflix during this period reached 73,000, representing a remarkable 102% increase compared to the previous 60-day average. While cancellations also experienced a slight uptick, the rate was not as substantial as the increase in new subscriptions. The sign-up to cancellation ratio grew by 25.6% compared to the preceding 60-day period.

Interestingly, the spikes in sign-ups during the initial days of the password-sharing crackdown surpassed those observed during the peak of the pandemic lockdowns in March and April 2020. This data suggests that concerns about a potential negative impact on Netflix’s subscriber base may not be as severe as anticipated, despite some vocal critics expressing their dissatisfaction with the policy on social media under the hashtag “CancelNetflix.”

A survey conducted by Jefferies analysts indicated that 62% of password borrowers claimed they would cease using Netflix instead of creating their own accounts. However, it’s important to consider that consumers often overstate their willingness to cancel services in surveys. Thus, it should come as no surprise if a significantly lower percentage of individuals actually follow through on their intentions to discontinue their Netflix usage.

Netflix addressed the anticipated short-term challenges related to member growth in its Q4 earnings report from January, stating, “We expect some cancel reaction in each market when we roll out paid sharing, which impacts near term member growth. But as borrower households begin to activate their own standalone accounts and extra member accounts are added, we expect to see improved overall revenue, which is our goal with all plan and pricing changes.”

Industry experts also remain optimistic about Netflix’s future prospects. JPMorgan analyst Doug Anmuth forecasts that by the end of 2025, approximately 33 million households worldwide currently sharing passwords will convert into paying subscribers. This conversion is expected to be split evenly between new subscribers and additional members who opt for higher-priced plans to add users outside their households.

Additionally, Netflix recently introduced a lower-priced, ad-supported tier in the US, which could help mitigate any potential subscriber losses resulting from the password-sharing crackdown. This move provides users with a more affordable alternative while maintaining the quality and range of content the streaming service offers.

While Netflix has yet to comment specifically on the recent data, these positive signs suggest that its strategy to address password-sharing is yielding favorable results. The company’s ongoing commitment to enhancing revenue through plan and pricing changes, alongside its efforts to attract new subscribers, reinforces its position as a leading player in the streaming industry.