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Starting in June, Disney+ will begin cracking down on subscribers who share their passwords with users who do not pay for them. From September, the measures against this will be fully on point and strictly applied. In this way, the company wants to increase the profits it gets from its streaming service, after earlier competitor Netflix successfully introduced similar measures.

The context: In February, Hugh Johnston, chief financial officer of Disney, announced during an internal meeting, that the company will finally work to combat password and account sharing on their streaming service.

  • The streaming service Disney+ is currently still a major loss leader for The Walt Disney Company. At one point, that loss was running at $4 billion a year. Last quarter, that loss was still $130 million. Disney hopes to be profitable with Disney+ by the last quarter of 2024.

The news: In an interview withCNBCDisney CEO Bob Iger has now disclosed more details about that. In particular, he talked about the timing of those moves.

  • "In June, we will launch our first real effort to combat password sharing in a few countries and in a few markets. After that, that will grow to a full rollout in September," Iger said.

The details: The new rules prohibit subscribers from sharing their account passwords with people outside their own households. Accounts that continue to do so may be terminated by Disney.

  • For now, though, it is not known exactly how Disney+ will find out if users on the same account are actually part of the same household.

Netflix

With these measures, Disney+ is clearly following the successful example of competitor Netflix. A year ago, they also had to deal with poor figures and a declining number of subscribers for several quarters. Netflix then decided to act against account sharing. At the time, many pundits expected the streaming service to lose even more users this way, but the opposite turned out to be true. Recently, Netflix was able to present some very nice numbers. The streaming service even added 30 million subscribers by 2023.

  • "Netflix is the great example in streaming. They have done phenomenal work in a lot of areas. If we could achieve what they have achieved, that would be great," Iger added. The Disney+CEO did admit that there was no guarantee that their measures against password sharing will have the same positive result.

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