Last year, Netflix made the controversial move to stop allowing users to share passwords with people outside their households.
And it looks like it paid off for them, so don't expect them to ease up on the new rules.
Ted Sarandos, co-CEO of the company, said in a Tuesday earnings call that Netflix is "thrilled" with the engagement trends the streaming service is seeing both domestically and around the world as the platform finds a new normal following the rollout of the password rules.
"Our engagement is a bit impacted by our paid sharing. Think about it like fewer households using the same account," Sarandos said. "So as those folks spin off and get their own accounts, and we win them over with our programming, that will normalize and continue to grow. We're really pleased with our engagement."
Sarandos added that Netflix subscribers average roughly two hours of engagement each day with the platform, with hits like "Stranger Things," "Bridgerton," and "Squid Game" attracting enormous audiences in countries all over the world.
Those audiences are willing to pay either full subscription costs, ranging from $6.99 to $22.99 each, or shell out the additional $7.99 charge to add new users to their existing accounts.
The company had temporarily paused increasing the price of its subscription packages while rolling out the password-sharing rules, co-CEO Greg Peters noted in Tuesday's earnings call, but now that users have acclimated to the fee, prices may continue to creep up.
"You've seen us do that in the US, UK, and France. Those changes went well, better than we forecasted," Peters said. "And we will continue to monitor other countries and try and assess when we've delivered enough additional entertainment value — we look at engagement, retention, and acquisition as the signals there — so that we can go back to members and ask them to pay a bit more to keep that positive flywheel going, so we can invest in more great film series and games for those members."
Peters added: "So you know, the summary statement might be: 'back to business as usual.'"
