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Netflix's password-sharing crackdown has been successful

Netflix's crackdown on password-sharing has proven to be successful, according to new data from Antenna. The company implemented a policy in May that charges US subscribers an additional $8 per month to add a user who does not live in the account holder's household. Antenna's data shows that in the six days following the implementation, Netflix experienced its four largest days of user acquisition in the four and a half years that Antenna has been tracking it. The momentum has continued, with a spike in new sign-ups in June and July. This surge in subscriptions contributed to a strong Q2 for Netflix, which added 5.9 million subscriptions worldwide. While the crackdown did result in increased cancellations, it led to even more new subscribers. In July, Netflix saw a dip in new sign-ups compared to June, but it still commanded a significant portion of the premium subscription video-on-demand market.

Analysts estimate that the crackdown on password-sharing could eventually lead to 33 million households globally converting into new paying subscribers by the end of 2025. This projection takes into account both new subscribers and additional users being added to existing accounts. The success of Netflix's crackdown has caught the attention of other streaming services, with Disney CEO Bob Iger announcing plans for a similar crackdown in 2024.

In addition to the password-sharing crackdown, Netflix's cheaper ad-supported tier has also been well-received by new subscribers. Antenna's research shows that 23% of Netflix sign-ups opted for the ad-supported plan, which costs $7 per month. This is a 4% increase compared to June and the highest portion of sign-ups since the plan's launch in November.

Overall, it is evident that Netflix's efforts to crack down on password-sharing and introduce a cheaper ad-supported tier have paid off. The company has seen a significant increase in new subscribers, and analysts predict continued growth in the future. Other streaming services are taking note of Netflix's success and considering implementing similar measures.

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