Netflix CEO explains why platform stopped customers from being able to share their passwords

The CEO of Netflix has revealed exactly why the company has cracked down on password sharing in recent years.

Let me cast your minds back one year - Covid-19 restrictions were finally lifted worldwide, we were still begging for an Oasis reunion and Miley Cyrus seemed to stay atop the charts with 'Flowers'.

However, many will remember that this is when Netflix started the trend of clamping down on sharing passwords, limiting it to one account per household.

This came before its decision to remove its lower tier ad-free plan, leaving users with a decision between a £4.99 plan with ads, or £10.99 without.

It shook the world, without sounding too dramatic, as Netflix also released a statement in May 2023, saying: "Starting today, we will be sending this email to members who are sharing Netflix outside their household in the United Kingdom."

Attached was an email template that was sent to members that were suspected of sharing accounts with others, which explained: "Your Netflix account is for you and the people you live with - your household."

Despite these changes, it also clarified that these changes won't apply to those that travel, adding: "You can easily watch Netflix on the go and when you travel - either on your personal devices or a TV at a hotel or holiday home."

To conclude, the streaming service emphasised that one account is for one household, but that household can make the most of their account whether they are in the country or not.

But now, we've heard from the company's co-CEO, Ted Sarandos, who revealed why they've looked to cut down on password sharing.

A clip of the explanation was shared on TikTok, with the big boss citing 'a couple of problems' when asked about why they had decided to introduce the new measures.

"One was revenue, but the other part of it was with this personalisation," Sarandos said during an appearance on The David Rubenstein Show: Peer to Peer Conversations.

"Helping you find something to watch works better, if you don't have five or six different people using your account."

He added: "So for us, it was really a way to really hone in with the personalisation technology, but also a way to kind of test the value proposition."

Despite the backlash on social media following the decision, the CEO claimed the new measures have proved successful for the streaming platform.

Sarandos continued: "Our average members are watching about two hours of Netflix every day, so basically, when you go back out to people and say, hey, you know that thing that you're using for two hours a day and not paying for?

"We'd like you to get your own account. And what's turned out nicely about that is most people say, 'Yeah, that's well worth it for me to do that'."