Disney+ Follows Netflix's Footsteps In Password Sharing Crackdown: 'Borrowers' Will Have To Pay Up Or Get Booted Out
Portfolio Pulse from Rounak Jain
The Walt Disney Co. (NYSE:DIS) announced plans to intensify its crackdown on Disney+ password sharing, following Netflix Inc.'s (NASDAQ:NFLX) lead. Disney CFO Hugh Johnston revealed during the Q1 earnings call that accounts suspected of password sharing will soon require users to create their own subscriptions. Additionally, Disney+ will offer the option to add users outside a household for an extra fee, similar to Netflix, though this feature will be introduced later in the year. The company does not expect significant benefits from these initiatives until the latter half of 2024. Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL) has also started enforcing similar restrictions on YouTube Premium family subscriptions.
February 08, 2024 | 8:56 am
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Disney announces stricter Disney+ password sharing crackdown and plans for additional user fees, aiming to boost subscriber base.
Disney's crackdown on password sharing and the introduction of fees for additional users outside a household are strategic moves to increase its subscriber base and revenue. While the company does not expect immediate financial benefits, the long-term strategy aims to enhance subscriber growth and reduce unauthorized access, potentially leading to a positive impact on Disney's stock in the medium to long term.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100
NEUTRAL IMPACT
Alphabet's YouTube enforces household requirements for YouTube Premium family subscriptions, joining the industry trend.
Alphabet's move to enforce household requirements for YouTube Premium family subscriptions aligns with the broader industry trend of cracking down on password sharing. While this decision reflects Alphabet's commitment to addressing unauthorized sharing, the immediate financial impact on the company's stock is likely neutral, given the broader scope of Alphabet's business and the early stage of this policy's implementation.
CONFIDENCE 70
IMPORTANCE 50
RELEVANCE 60
NEUTRAL IMPACT
Netflix, already enforcing password sharing restrictions, serves as a model for Disney's new initiatives.
Netflix's existing password sharing restrictions and the introduction of additional user fees have set a precedent in the industry, influencing Disney's strategy. As Netflix has already implemented these measures, the immediate impact on its stock might be neutral. However, the industry-wide adoption of such policies could reinforce Netflix's position as a market leader in addressing password sharing.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70