Netflix's plan to charge people for sharing passwords is already a mess before it's even begun

Business Insider US
A scene from Netflix's "Stranger Things" season three.
  • Netflix says it will charge users who let people outside their households use their account.
  • It has been trialing this new policy in Costa Rica, Chile, and Peru.
  • Peruvian Netflix users told Rest of World they haven't seen any enforcement, and the policy has been confusing.
  • For more stories go to

Netflix has been trialing its upcoming crackdown on password-sharing in three Latin American countries — but with limited success so far, Rest of World reports.

Netflix reported its first subscriber loss in over a decade in April and said people sharing passwords to their accounts was in part responsible.

The streaming giant started testing a stricter enforcement policy in March to prevent people sharing passwords with people outside of their "household" in Costa Rica, Chile, and Peru.

Under the new policy, subscribers in those countries are technically subject to a $2.99 charge for every person outside of their household that uses their account.

Rest of World spoke to more than a dozen Netflix subscribers in Peru who said the messaging around the policy change has been confusing and they haven't been subject to any enforcement charging them for sharing passwords.

Central to consumer confusion has been how Netflix defines a "household," Rest of World reports.

A Netflix representative told Rest of World while the company is aware some consumers think that means anyone in an account-holder's immediate family, the company defines a household as people who share a physical domicile. Netflix did not immediately respond when contacted for comment by Insider about Rest of World's report.

Rest of World also reported Netflix has run into resistance from state consumer agencies in Costa Rica, Peru, and Chile. Peru's consumer agency recommended Netflix work to clarify its definition of a "household" with customers, per Rest of World.

The same agency told Rest of World Netflix's new policy of charging users for sharing passwords could lead to arbitrary discrimination against consumers.

An anonymous Netflix customer service representative told Rest of World herself and other customer service reps were confused about what to tell account holders when asked about the new policy.

The customer service rep said if a customer called asserting a member of their household was using the account from a different location, she was instructed to tell them that person could continue to use the account via a verification code without incurring an extra charge. 

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