Disney+ to Follow Netflix’s Password Sharing Policy
By Movieguide® Contributor
In its new terms of service, Disney revealed that it is now against its platform’s policy for subscribers to share password information with those living outside of the household.
“Later this calendar year, account holders who want to allow access to individuals from outside their household will be able to add them to their accounts for an additional fee,” said Disney’s CFO Hugh Johnson
“We are still in the early days and don’t expect notable benefits from these paid-sharing initiatives until the back half of calendar 2024, we want to reach as large an audience as possible with our outstanding content, and we’re looking forward to rolling out this new functionality to improve the overall customer experience and grow our subscriber base,” Johnson added.
Disney first began pursuing a crackdown on password sharing after Netflix announced it would do the same last year. Netflix has since implemented a policy limiting the use of its platform to those living within the same household – as Disney will now do.
Although Netflix saw an initial kickback from its decision, it has since seen a consistent uptick in subscribers, especially among its ad tier, which was introduced at the same time as the policy change. Disney is now going through the same process, limiting accounts to one household.
The new policy has been implemented for new subscriber sign-ups and will be enforced on existing accounts starting on March 14. The new restriction has also been placed on Hulu and ESPN+, Disney’s other streaming services.
Despite a total subscriber count of 224.5 million across its three platforms, Disney has yet to turn a profit on its streaming services. The company, however, has already made impressive improvements, narrowing the deficit from $1.05 billion in Q1 of 2023 to $216 million in Q1 of 2024.
“[Disney] remain[s] poised to reach profitability in our streaming business by the end of fiscal ’24 and build on our momentum to deliver significant sustained profit margins in the future,” Johnson said.
Movieguide® previously reported:
While many worried about what cracking down on password sharing would mean for Netflix, the change has resulted in millions of new subscription sign-ups.
Since limiting account users to those living in one household, Netflix has seen a significant rise in new member sign-ups, many of whom are opting for the new ad-tier subscription level. According to research group Antenna, around 23% of users who signed up in July chose the cheaper option.
“The company estimated that more than 100 million households had shared their log-in credentials with friends and family outside their homes. This has led analysts to expect that about 50 million users will ultimately create their own accounts,” Reuters reported.
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