Netflix was the first big streamer to implement a ban on password sharing, and the whole thing worked marvelously. Many subscribers were annoyed, and some threatened to quit Netflix when the ban was implemented. While we don’t yet know the long-term implications, Netflix clearly won the early battle. The streamer added some 22 million subscribers in the second half of last year, with more than 13 million new subscribers joining Netflix in the December quarter.
I said while we were witnessing the arrival of Netflix’s password-sharing ban that rivals would probably copy it. Disney was the first to announce that Disney Plus password sharing would no longer be allowed. That was last year, and Disney has not implemented any changes since then.
Then, a few weeks ago, Disney said the same thing about Hulu. Again, we only had new terms of service but no measures to actually enforce them.
If you were worried about your Disney Plus and Hulu access, you shouldn’t do anything for another few months. Disney won’t actually do anything to restrict password sharing until sometime this summer. But when it does, the whole thing will resemble Netflix’s war on password sharing.
It all comes from Disney’s chief financial officer Hugh Johnston. He shared more details about Disney’s anti-password-sharing actions during the company’s earnings call on Wednesday.
Johnston said that Disney Plus accounts “suspected of improper sharing” will get an option to sign up for their own subscription. But it won’t happen earlier than this coming summer.
If that sounds familiar, it’s because you might have seen such nudges from Netflix last year. Moreover, Disney will want an “additional fee” for access outside the main Disney Plus household. It’s unclear how much you’d have to pay. Netflix charges an extra $7.99 per additional user, with a maximum of two.
I explained that getting a new subscription is better than becoming an extra member on someone’s Netflix account. The same might be true for Disney Plus, once Disney starts rolling out its true password sharing ban.
Presumably, Disney has a lot of work to get the ban working on both Disney Plus and Hulu. I’m just speculating, of course. But it can’t be easy to turn on a ban. You’d have to have the proper software features in place to track account access and then offer customers a way to sign up for a new subscription or add members.
That’s why you have enough time to share Disney Plus and Hulu passwords and not worry about repercussions. As for any actions Disney might take against password-sharers, I wouldn’t expect actual bans. Disney Plus and Hulu will probably require household checks similar to Netflix. That can cripple the streaming experience, and that’s enough to get some users to buy their own subscriptions.
That’s the whole point for Disney. Johnston said as much during the call, per The Verge. “We want to reach as large an audience as possible with our outstanding content,” he said. “We’re looking forward to rolling out this new functionality to improve the overall customer experience and grow our subscriber base.”
The exec is also aware that Netflix has been taking advantage of paid sharing, and the company wants to mimic it for Disney Plus and Hulu. “We’ve got some very specific actions that we’re taking in the next couple of months,” he said.
It’s unclear what these actions are. But, overall, it looks like Disney’s password-sharing ban will look and feel a lot like Disney’s. I’d expect the Disney Plus and Hulu experiences to be similar when it comes to enforcing the ban.
It’ll be interesting to see if Disney can convert as many people to its streaming products as Netflix did after banning password sharing. We’ll have to wait for early 2025 to see Disney’s figures for Disney Plus and Hulu to tell whether the ban worked.
