Netflix is pushing back plans to crack down on password sharing in the U.S.
In an earnings report released on Tuesday, the streamer said it "shifted out the timing of the broad launch from late Q1 to Q2."
"We're working hard to make sure that we do it well and as thoughtfully as we can," said CEO and Director Gregory Peters.
Netflix did roll out new anti-password sharing rules in Canada, New Zealand, Portugal, and Spain in February, but the rules never reached the US. Now, Netflix says that it's "pleased with the results" of its paid sharing implementation in these four countries so far.
"We also learned from this last set of launches about some improvements we can do, especially in areas that matter a lot to our members, things like having seamless access to Netflix as they've always been using it on the go or while traveling," Peters said. "So all in, we felt, based on those results, it was better to take a little bit of extra time."
The streamer anticipates to initially lose some subscribers once the new rules do go into effect. But in the long run, they say the move will actually boost subscriber numbers.
"It's very much like a price increase, we see an initial cancel reaction. And then we build out of that, both in terms of membership and revenue as borrowers sign up for their own Netflix accounts, and existing members purchase that extra member facility for folks that they want to share it with," Peters explained.
While it's still not clear exactly how paid password sharing will work, how much it will cost or when exactly the new rules will go into effect, the changes are expected to be in place by the end of June.
Under the current rules, Netflix subscribers are not supposed to share their passwords with people outside their household. A statement from Netflix in February said more than 100 million households are sharing accounts, which impacts the company's ability to invest in new programing.
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