Netflix Hints at When It Will Start Cracking Down on Password Sharing

Netflix has given some updates on its controversial upcoming features, including cracking down on password-sharing and adding an ad-supported membership tier. Sources inside the company spoke to The New York Times on Tuesday, revealing that they have gotten an internal memo about these new features. The source reportedly said that the changes will start to go into effect in the last three months of 2022.

Netflix originally indicated that it was experimenting with new features but that users wouldn't see them for a while, but that timeline seems to have changed. Employees say that Netflix plans to implement its ad-supported membership tier in October, November or December of 2022. Around the same time the company will begin cracking down on accounts that are used by multiple households. Rather than trying to stop this practice, it will simply charge users who share their accounts more money.

These two new features were first teased last month during a tumultuous time for Netflix. The streaming giant had a horrendous first-quarter earnings report, marking the first time it ever had to report losing subscribers rather than gaining new ones. To be fair, the company lost many of those subscribers when it stopped providing its service in Russia in protest of the invasion of Ukraine, but even without that measure it still would have been down.

The poor report caused Netflix's stock price to plummet and forced the company to re-evaluate many of its strategies going forward. For years Netflix representatives have said that there would never be ads on the platform, but now it looks like they may be going back on that promise. However, the initial announcement said that an ad-supported tier might be coming "over the next year or two."

An official spokesperson for Netflix declined to comment on the Times' report. The internal note said that the ad-supported membership would be launched "in tandem with our broader plans to charge for sharing" log-in information – presumably to give users another, cheaper option if they don't want to pay the higher fees.

Netflix currently offers three membership plans. The "Basic" plan costs $9.99 per month, the "Standard" plan costs $15.49 per month and the "Premium" plan costs $19.99 per month. It's not clear whether the ad-supported tier would be added as a fourth option or whether the "basic" plan would simply have ads inserted into programming.