Netflix has been facing some tough times lately. It lost subscribers for the first time in over a decade earlier this year and is expected to lose even more. It also had to lay off 300 employees and is experimenting with more ways to retain existing subscribers and attract new ones. This endeavor has led to an influx of Netflix-branded mobile games, partnering with Microsoft to power ads on a new lower-cost streaming tier, and now, charging users extra to discourage password-sharing.
As spotted by Bloomberg, Netflix has started testing a modified subscription model in five Latin America countries which will force consumers to set one residence as their "home". If they watch Netflix on a TV in any other location for more than two weeks, they will be asked to pay an additional $2.99/month for that "home". In fact, even the two free weeks won't be offered if the additional residence has been used before and you aren't paying for it already.
And if you're worried about watching Netflix while traveling, you should know that the new password sharing rules only apply to TV screens. You can still stream on mobile devices and laptops in any location without paying extra.
As Netflix highlights on its Honduras support page:
As of July 18, 2022, your Netflix account includes one home.
A home is a physical location - like your house - where you can use your Netflix on any of your devices, and the number of devices you can watch on at the same time depends on your plan.
Beginning August 22, 2022, to use your Netflix account in additional homes, we will ask if you want to add a home for an additional fee per month. We will not automatically add a home and charge the extra fee.
- You can watch Netflix on your laptop or mobile device while traveling.
- You can watch Netflix on a TV outside your home for up to 2 weeks as long as your account has not been previously used in that location. This is allowed once per location per year.
There are also limitations on how many homes you can add. A Basic plan allows you to add one extra home, Standard has two, and Premium has three. Homes can only be replaced three times every six months. Netflix says that it detects a home through IP addresses, device IDs, and account activity.
Netflix has previously talked about how password sharing is a major pain point. Netflix CEO Reed Hasting had noted that over 100 million households are guilty of breaking the platform's password sharing policies.
It remains to be seen how the latest policies will affect customer churn. As of now, the new subscription model is only available in Argentina, El Salvador, Guatemala, Honduras, and the Dominican Republic. It will also be interesting to see if the price for buying extra homes varies in other regions based on respective economies and purchasing power.