How Netflix’s new password-sharing rules will work

Nearly six years ago, Netflix made a simple claim on Twitter: “Love is sharing a password.”

A lot of love has been going around since then — more than 100 million Netflix users share passwords with their friends, families, exes and even complete strangers, according to the company’s fourth-quarter shareholder letter.

But it seems the streaming giant has changed its mind on the meaning of love.

On Wednesday, Netflix announced it will begin rolling out new password-sharing rules in Canada, New Zealand, Portugal and Spain.

The announcement comes after Netflix last week updated its online frequently asked questions page with information on account sharing. The company also detailed how it aims to crack down on password sharing in the United States in a January company earnings call.

The biggest change — and the one that caused all the rage — is that Netflix redefined which users can share an account.

The new password-sharing rules detailed protocols to prevent people in different households from using the same Netflix account.

Under those rules, which are in practice in Chile, Costa Rica and Peru, Netflix users would be required to verify their home devices every month. Devices outside the home would be blocked and users encouraged to create an account of their own at a discounted rate.

But on Feb. 1, the streaming platform said it had “errantly” posted this information, and the original version has been removed from the website, according to The Streamable.

The first line in the updated FAQ now reads, “A Netflix account is for people who live together in a single household.” A household, as Netflix defines it, is based on proximity and determined by location-based information such as IP addresses and device IDs.

So in the United States, if all the users on a Netflix account live in the same location, no problem.

If you’re a college student, a frequent traveler or someone who doesn’t have a home base, it gets a little bit trickier. Once you start introducing multiple devices, Wi-Fi networks and locations, that’s where the new rules — expected to take effect in March — will come into play.

In Netflix’s most recent earnings call, Gregory Peters, chief operating officer and chief product officer, said Netflix is seeking to monetize the viewing value that it delivers to get subscriber growth back on track.

“We’ve got folks that are watching Netflix who aren’t paying us as part of basically borrowing somebody else’s credentials,” Peters said, “and our goal is over this year to basically work through that situation and convert many of those folks to be paid accounts or to have the account owner pay for them.”

Peters noted this would not be a “universally popular move.”

“We’ll see a bit of a cancel reaction to that,” he said.

Here’s what to know about the new password-sharing policy:

The new rules in Canada, New Zealand, Portugal and Spain

For users in Canada, New Zealand, Portugal and Spain, the new password-sharing rules began Wednesday, Netflix said in its online announcement.

Netflix said it will help users set up a primary location where anyone living in that household can access the account.

For those living outside the primary household, Netflix will introduce the option to transfer a profile to a new paid account so users can keep their personalized recommendations, viewing history, My List, saved games and more.

As for travelers, “members can still easily watch Netflix on their personal devices or log into a new TV, like at a hotel or holiday rental,” the company said.

For members using a standard or premium plan, up to two people outside of a household can be added to the account at an additional charge. The out-of-household users will each have their own profile, personalized recommendations and their own login and password. Users on basic and ad-supported plans will not be able to add more members.

You can no longer share your Netflix account with someone who doesn’t live in the same household

“People who do not live in your household will need to use their own account to watch Netflix,” the streaming service said online.

Netflix said it may ask people to verify their devices if someone logs into an account from a device outside the household.

For now, the company says it won’t “automatically charge you” if someone logs in outside your home network.

You’ll need to verify your device

Let’s say you’re traveling and will be away from home for some time. If you try to access your Netflix account or sign into a device not associated with your home Wi-Fi, Netflix may ask you to verify your device.

You’ll have to enter a four-digit code sent to the account owner’s email or phone within a 15-minute expiration window.

“We do this to confirm that the device using the account is authorized to do so,” the streaming service said online.

Netflix users in Chile, Costa Rica and Peru have to renew their account credentials every 31 days, and the streaming platform said “device verification may be required periodically” for users in the United States.

You won’t have to verify your device if you’re using the same internet connection in the primary account owner’s household.

To verify accounts within the same household, Netflix said, it will use information including IP addresses, device IDs and account activity from devices signed into the account.

Can you still use Netflix while traveling?

The streaming platform said “if you are traveling or live between different homes, we want you to be able to enjoy Netflix anywhere, anytime.”

But if you are the primary account owner (or live with the owner) and you’re away from your household for “an extended period of time,” the streaming platform will prompt you to verify your device.

Almost makes you miss the simpler days when you could order a movie online and a DVD would arrive in a red envelope in the mail, right?