July 21, 2015
Netflix, HBO and other Internet video-subscription providers will lose about $500 million worldwide in 2015 due to nonpaying customers who piggyback off the login info of paying friends and family. However, because these companies want to make it easy for consumers to use their services, especially as the number of new subscribers continues to grow, they have yet to crack down on password sharing. Netflix and HBO execs are reportedly not concerned about the issue, as studies have shown many unauthorized users eventually become paying customers.
Variety reports that according to Parks Associates, unauthorized password sharing is most common among consumers ages 18-24, as 20 percent of that demographic watches videos on accounts that do not belong to them.
Netflix and HBO Now are designed for shared family usage, so different members of the family can stream on different screens at once. These multi-stream capabilities are popular and increase the perceived value of the subscription, but video-subscription providers cannot block unauthorized users if they have passwords, since there is no authentication system in place.
To maintain user convenience, Netflix and HBO Now have not added authentication processes to their user accounts. However, Netflix has included password sharing in its pricing strategy, by offering a family plan deal for a shared account. Similarly, HBO provides up to three concurrent streams per account.
Though video-subscription providers are not yet worried about unauthorized streaming, they are keeping close watch to make sure password sharing does not get worse.