Warner Bros. Discovery is preparing to crack down on password sharing for its streaming service, Max, with a phased rollout beginning in the next few months. During the company’s Q3 earnings call on Thursday, CFO Gunnar Wiedenfels outlined the plan, emphasizing a “soft messaging” approach initially, followed by further action in 2025 and 2026.
Password Sharing as a “Price Rise”:
Wiedenfels characterized the crackdown on password sharing as a form of price increase, stating that the company is “asking members who have not signed up, or multi-household members to pay a little bit more.” This strategy aligns with similar actions taken by other streaming giants like Netflix and Disney+, which have implemented paid sharing options to curb unauthorized account access.
Phased Rollout:
The initial phase of Max’s password-sharing crackdown will involve gentle communication and education to inform users about the upcoming changes. This approach mirrors Disney+’s strategy, which included sending emails to customers about paid sharing before rolling out its “extra member” option.
Potential Price Increase:
Wiedenfels also hinted at the possibility of a price increase for Max, citing the “premium nature” of the service and the potential for further price adjustments. Max last raised prices for its ad-free plans in June.
Subscriber Growth and Content Strategy:
Despite the upcoming changes, Max reported strong subscriber growth in the third quarter, adding 7.2 million subscribers to reach a total of 110.5 million globally. Warner Bros. Discovery CEO David Zaslav also emphasized the company’s commitment to improving consistency in its film and games businesses following the disappointing performance of “Joker: Folie à Deux.”
Industry Trends:
The crackdown on password sharing reflects a growing trend in the streaming industry as companies seek to maximize revenue and control unauthorized account access. As competition intensifies and content costs rise, streaming services are increasingly implementing measures to ensure that users are paying for the services they use.
Max’s approach to password sharing will be closely watched by industry observers and consumers alike. The company’s ability to effectively communicate the changes and implement a fair and user-friendly paid sharing option will be crucial to maintaining subscriber satisfaction and achieving its revenue goals.