Max to Crack Down on Password Sharing

Published: March 7, 2024

Photo from Bolivia Inteligente via Unsplash

Max to Crack Down on Password Sharing

By Movieguide® Contributor

In the never-ending effort to make streaming profitable, Max announced it will be cracking down on password sharing this year, following the lead of Netflix and Disney.

“I’m conscious of not over-selling [the password crackdown] because you see Netflix’s success. But Netflix was in market for 17 years. That means people are sharing passwords for 17 years,” said JB Perrette, head of global streaming and games at Warner Bros. Discovery.

“We’ve been in the market for four, if you count the HBO Max launch. And obviously, we’re not quite at the same scale, but relative to the scale of our business, it’s a meaningful opportunity,” Perrette continued.

Ending password sharing has become the latest trend among streamers as they hope to turn shared accounts into multiple paying customers. However, the crackdown also comes with the risk of losing subscribers who quit the platform in protest.

Netflix cracked down on password sharing starting last spring and has seen a net positive from the action, adding tens of millions of subscribers to its already industry-leading numbers that topped 260 million in Q4 of 2023.

As is the case with many trends in streaming, other major platforms are now following Netflix’s footsteps, although with less success.

Earlier this year, Disney announced its plans to crack down on password sharing. However, with an already shaky user base, it is unclear if this move will effectively drive more profit.

However, with subscriber rates slowing–down to 10.1% growth from 21.6% in 2022–regulating password sharing seems to be one of the only options to push more subscriptions. Streaming services also benefit from subscriber reuptake, as 10% of consumers who cancel their subscriptions are re-subscribed by the end of the month, while one in three are back within six months.

Warner Bros. Discovery appears to be banking on these numbers with its password crackdown, as it saw limited growth last year. Max lost roughly 2.5 million subscribers domestically last year while only posting a gain of less than 1 million globally.

During the company’s Q4 report, CEO David Zaslav explained that another avenue he believes could draw subscribers in the future is bundles.

Movieguide® previously reported:

Given the difficulties Max has found in continuing momentum since its launch, Warner Bros. Discovery now plans to bundle it with other services in the future to increase its reach.

“I expect that there will be meaningful bundling,” Zaslav said. “It’s going to happen in one of two ways. It’ll either be a bundling by an intermediary – a platform like Apple or Amazon or Roku, or you know what’s going on with Charter and Comcast [with their Xumo streaming box] which is very compelling and very helpful to all of us in the content business… Or we could do it ourselves. And I’ve always advocated that we should do it ourselves.”

“We’re able to go after those that we’re missing. We’re missing those subscribers. The traditional cable industry is missing those subscribers. We think it’s very pro-consumer,” Zaslav added about a sport’s specific streaming bundle that would include Warner Bros.’s TNT and TBS along with ESPN and Fox Sports.

Zaslav showed further optimism about the future of the company based on its lineup of content slated to be released during the next two years. Some of the company’s most popular IPs will be reintroduced, including a Harry Potter TV series and a sequel to JOKER before the revitalization of the DC universe.