Is Sharing Your Netflix Illegal?
Lots of people share their password for Netflix, Hulu or Amazon Prime with family and friends. But is it a crime to share your video streaming account with non-paying others? Read on to find out...
Sharing Streaming Accounts: Piracy Lite
Have you ever seen a message like this? "Your Netflix account is in use on another device. Please stop playing on other devices to continue." That may happen if you're oversharing. But how much sharing is too much sharing? And when does it rise to the level of a crime?
Netflix recently announced a $1.00 increase in the monthly fee for its standard subscription, which allows simultaneous streaming to two devices. A Goldman Sachs analyst says, “We believe a targeted price change like this is designed to reduce excessive password sharing by incentivizing users to switch to the 1-screen plan,” which costs $1 less per month.
A Consumer Reports poll found that 46% of Americans have shared their streaming account passwords with someone outside of their home. About 11% of broadband-using households receive Netflix, Amazon Prime, Hulu Plus, or some other streaming services by sharing someone else’s password, according to a May 2015 study conducted by Parks Associates. That translates into a combined $500 million of lost revenue for all streaming service providers in 2015.
College students are the worst moochers, with 20% of 18-24 year-olds admitting they use someone else’s password to get Netflix or other video streaming services for free. Usually, it’s their parents’ account, but students have no problem with sharing passwords among themselves.
Officially, Netflix is unconcerned about this “piracy lite,” as Parks Associates calls it. The company says it doesn’t track revenues lost to password-sharing. None the less, Netflix’s terms of service warn subscribers, “The Account Owner should not reveal the password to anyone.”
How Much Sharing is Allowed?
Netflix customers have three options. There's the 1-screen account which allows no sharing. Two-screen and four-screen options cost a few dollars extra per month, and are supposed to be limited to sharing within a household. But it seems the company doesn't enforce that restriction, nor do they assess any penalties for violators. Amazon Prime limits customers to two devices for simultaneous viewing. HBO GO allows for three, but Hulu Plus has a limit of one viewing device at a time.
Of course, these restrictions only apply to simultaneous viewing. If you share your password with 10 people, and they're all watching at different times, you won't hit any multiple screen limits. And for the most part, the content providers don't seem to have a problem with that.
In Tennessee, however, sharing a streaming service password is a misdemeanor under a "theft-of-services" law that was updated in 2011 to explicitly include “web entertainment services.” Violators face up to a year in jail and up to a $2,500 fine. I can’t find any evidence of prosecutions under this law, and one wonders why the state would have it on the books when the streaming services seems quite capable of managing the situation themselves.
“Piracy lite” may be morally wrong and technically illegal in Tennessee, but it’s not very dangerous. Password-sharing is different from the theft and resale of passwords. There is little security risk in sharing a Netflix password with a college-bound child, a significant other, or someone else you know and trust. Streaming services don’t provide opportunities to plant malware on an account holder’s computer or compromise financial accounts.
On the other hand, couples who share streaming accounts while romantically involved often find it difficult to stop after they break up. A recent article on Slate.com asks, “Do couples need pre-nups for their shared streaming passwords?” http://goo.gl/h5AA9T It explores several relationships, some bittersweet and some horrifying, in which people continued to share streaming passwords after their relationships ended. Several examples left me shaking my head and mentally urging the account owners to “just change the darned password!”
Netflix, Hulu, and other streaming services are unlikely to crack down on password-sharing in the near future. Even half a billion dollars is a drop in the streaming industry’s bucket, and every freeloader who becomes addicted to streaming media is a potential paying customer when Mom and Dad (or an ex-girlfriend) cut the cord. But Netflix’s recent price change suggests that password-sharing needs to be reined in, or at least “disincentivized.”
Your thoughts on this topic are welcome. Post your comment or question below...
This article was posted by Bob Rankin on 29 Oct 2015
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Article information: AskBobRankin -- Is Sharing Your Netflix Illegal? (Posted: 29 Oct 2015)
Copyright © 2005 - Bob Rankin - All Rights Reserved