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Netflix experienced a decline of over one million users in Spain during the first quarter of 2023, as reported by market research firm Kantar.
Netflix app on a tablet screen. Image credit: Souvik Banerjee via Unsplash, free license
According to market experts, this decrease is a clear indication that the streaming giant’s efforts to crack down on password-sharing practices among users may have had consequences that were not accounted for in advance.
In early February, Netflix introduced a €5.99 ($6.57) monthly charge for Spanish users who shared their login credentials with another household or households. The company also implemented technological measures to detect such sharing.
Following the rollout of the streaming service in several Latin American nations, a similar fee was introduced in Portugal, Canada, and New Zealand.
According to Kantar’s research, which involved surveys on streaming habits within households, this move resulted in a drop of over a million users, with two-thirds of them utilizing someone else’s password.
Dominic Sunnebo, the global insight director at Kantar’s Worldpanel Division, commented that this significant decline could be easily attributed to the stricter password-sharing control policy on Netfix’s side.
Sunnebo also said that the loss of a million users – no matter whether they are paying subscribers or not – would have a negative impact on Netflix, primarily in terms of informal marketing, i.e. word-of-mouth recommendations for its content and services.
Kantar’s research revealed that subscription cancellations in the first quarter tripled in comparison to the preceding period. Among the remaining Netflix subscribers in Spain, one-tenth expressed their intention to unsubscribe in the second quarter.
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