Another streaming service is taking steps to ensure its members don’t share their passwords with friends and family.
Warner Bros. Discovery’s Max plans a crackdown which will start later this year and roll out completely in 2025, according to a report on Bloomberg.
The news follows a larger-than-expected quarterly earnings loss by the company in February that sent shares plunging. Streaming, though, is something of a highlight. The company reported a $103 million profit in the streaming division, compared to a $1.6 billion loss in 2022.
The move follows Netflix’s decision to put an end to password sharing last year and a similar action in February by Disney+, Hulu, and ESPN+. Last August, Disney CEO Bob Iger said the issue was “a real priority” in an earnings call with analysts.
Password sharing has become a problem for all streaming services and could cost the industry up to $25 billion a year, according to a Citibank report. Netflix said in 2022 that more than 100 million households are using accounts paid for by other people.
It’s unclear how many Max households are sharing their passwords.
Crackdowns drive subscriptions, though. Netflix saw a big surge in sign-ups after it prohibited the sharing of user passwords. In the quarter following the action, the service saw 5.9 million new users, nearly three times what analysts had estimated.
The problem with forcing users to have their own passwords, though, is churn: subscribers canceling their streaming plans after they finish watching whatever buzzy series or event convinced them to sign up in the first place. The number of users industry-wide canceling their streaming services has nearly tripled since 2019. Last year, there were 140.5 million cancellations, the largest drop in subscribers over the last five years, according to analytics platform Antenna.
