Netflix tackles account sharing in the US and ends its DVD subscription service

Netflix's plan to monetize account sharing is set to roll out in the remaining markets, including the US, over the course of the second quarter. The streaming giant has been testing this feature in Canada, New Zealand, Spain, and Portugal, and has been pleased with the results.

As part of the plan, the primary Netflix user can add two more people outside of their homes to the plan for an additional fee per person. The pricing will be higher in more affluent countries. The company uses data such as IP addresses, account activity, and device IDs to determine whether a device signed into an account is associated with the primary location.

Netflix's move to monetize account sharing is aimed at increasing its paid membership base. In a note to shareholders, Netflix said that it has been “pleased with the results” of its measures to block users from sharing passwords so far. In Canada, for example, Netflix says that its “paid membership base is now larger than prior to the launch of paid sharing.”

As part of those plans, the primary Netflix user has had the option to add two more people outside of their homes to the plan for an additional CAD$7.99 per month per person in Canada, NZD$7.99 in New Zealand, 3.99€ in Portugal, and 5.99€ in Spain. Netflix did not reveal pricing for the U.S., or other countries, but said that the pricing will be higher in more affluent countries.

In another move, Netflix has announced that it will ship out its last DVD on September 29, transitioning existing DVD subscribers to streaming-only subscriptions. Founded in 1997, Netflix started as a mail-based rental system for DVDs. Users would receive a DVD in the mail, watch it, and then return the DVD via a prepaid envelope. Now, the company is ending its 25-year-long DVD subscription service.

The move to end the DVD subscription service is a reflection of the shift in consumer behavior towards streaming services. Netflix has been investing heavily in content to stay ahead of the competition and retain its position as the leading streaming service. The company is also exploring other revenue streams, such as gaming, to diversify its business.