Netflix has made a remarkable comeback, thanks to its successful crackdown on password sharing. The company’s co-CEO, Greg Peters, was instrumental in addressing this issue, which had been a significant challenge for Netflix.
In February, Peters addressed the company’s New Employee College, where he gave a summary of Netflix’s history and analyzed the competitive landscape. He highlighted how traditional media companies like Walt Disney Co. and Paramount Global, which were slow to introduce streaming services, were now struggling to make money.
Netflix’s strategy to combat password sharing involved a paid-sharing plan, designed to eliminate unpaid account sharing. This plan was unveiled in the second quarter of the year and was prepared for a broad rollout in the coming months. The plan prompts users who are borrowing someone else’s account to sign up for their own plan or to have primary account holders add them as an “extra member.”
This strategy proved to be extremely successful, leading to a significant increase in new subscribers. Netflix added 29.5 million net new subscribers in 2023, up from an annual average of 21 million in 2020-22. This success was a key factor in Netflix’s comeback and its continued growth in the streaming market.
Read more: Bloomberg