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Looks like none of us are going to be able to use our exes’ Disney+ logins anymore.
Beginning this summer, the streaming service will begin cracking down on password sharing, Disney SEVP and CFO Hugh Johnston announced earlier this month during Disney’s quarterly earnings call.
Later this year, account holders will be able to pay an additional, as-of-yet undisclosed fee to add users outside of their households to their subscriptions. This summer, the actual crackdown will begin, with accounts identified as sharing subscriptions receiving notifications from Disney encouraging them to open new accounts.
Existing subscribers to Disney+,Hulu, and ESPN+ have until March 14 before Disney will begin enforcing new terms and conditions that prohibit password sharing, limiting use of an account to the account holder’s immediate household, according to an email sent to subscribers. New customers who have signed up since January 25 are already subject to those terms.
“While we are still in the early days, and don’t expect notable benefits from these paid sharing initiatives until the back half of calendar 2024, we want to reach as large an audience as possible,” Johnston said.
Copycat? Disney’s crackdown on password sharing follows a similar move from Netflix, which began limiting password sharing last year as a way to encourage new sign-ups and generate more revenue.
In May, the streamer began charging users $7.99 per month to add an additional user outside of their household. It seems to have paid off: Netflix added more than 13 million subscribers last quarter, and the streamer now has more than 260 million subscribers globally, it reported late last month.
For Disney, the move to limit password sharing comes after Disney+ reported a loss of 1.3 million core subscribers in the quarter after hiking prices in October. Despite losing users, the streamer has increased revenue per user on its platform: Disney+ saw a growth in core ARPU by 14 cents quarter over quarter, due primarily to the price increases.
In terms of total global subscriber base, Disney+ had about 111 million subscribers at the end of last quarter, while Hulu had about 50 million, according to company figures. ESPN+ had about 25 million subscribers, Disney reported.
Ad tier on a tear? On Disney’s most recent quarterly earnings call, CEO Bob Iger reported that Disney+ had over 1,000 global advertisers on its ad-supported tier, which the company previously said in December had 5.2 million subscribers.
A password-sharing crackdown could further encourage the adoption of ad-supported viewing: According to research firm Antenna, a month after Netflix implemented password-sharing restrictions, its subscriber base grew by about 3.5 million subscribers, with about a fifth of them joining on the platform’s Standard with Ads plan.
Nearly one-third of all new signups in countries with ad-supported tiers are for the ads plan, Netflix reported in October.