Max, the popular streaming service under Warner Bros. Discovery (WBD), is gearing up to tighten its password sharing policies, with significant changes expected as early as next week. This move positions Max among other streaming giants, like Netflix and Disney+, which have already begun similar crackdowns.
Last month, during discussions about the company's strategic direction, Gunnar Wiedenfels, WBD's Chief Financial Officer, confirmed the impending changes. According to Wiedenfels, Max will initiate its soft crackdown on password sharing, beginning with subtle notifications aimed at users identified as sharing their accounts beyond their households. This is expected to commence shortly, before the new year rolls around.
JB Perrette, the global streaming chief at Warner Bros. Discovery, indicated during a recent media conference how Max plans to approach the crackdown. He explained, "We’ll start some early messaging with some people who we think are in the higher tier of usage." This means accounts displaying frequent access patterns from devices not connected to the home Wi-Fi will receive these notifications first, signaling potential violations of the service’s terms.
But users need not panic just yet. Initially, these messages will be described as 'gentle'?—essentially warnings rather than immediate consequences. Max is not expected to begin enforcing its new policies until 2025. By this point, users will have had ample time to adjust, albeit at the potential cost of increased subscription fees.
Starting next year, WBD plans to introduce a feature allowing account holders to add extra users for what will likely be an additional fee. Perrette hinted at the move being similar to the options currently offered by Netflix, where users can pay to add someone from outside their household to their plan. It’s intended to provide more flexibility for users who might need to share their account with family members such as college students living away from home.
Despite these measures, many streaming industry analysts see the tightening of password sharing as more than just policy enforcement; it's also viewed as an indirect price increase. Warner Bros. Discovery is leveraging existing user patterns to guide its approach. This strategy includes sifting through the data of how many people stream from each account, identifying those who might be able to justify additional charges.
While there’s no word yet on the exact pricing structure for adding additional users, the approach mirrors Netflix's gradual rollout last year. Many Netflix users were moved to react defensively, initiating hot debates online about the fairness of restricting account sharing, especially among family and friends.
The change isn’t just about user convenience, though. WBD is aiming for more substantial subscriber growth. From the firm's perspective, restricting password sharing could potentially drive new customers who had relied on shared accounts to sign up for their own, creating more paying users.
During earnings calls, WBD reported stagnant growth, adding only 200,000 new customers over the last financial quarter. Such slow growth is causing executives to rethink their strategies surrounding subscription boosts. The Freemium model, initially popular among streaming platforms, is getting phased out, and Max appears to be following suit.
Max's transition aligns with industry trends. Over the past few years, many streaming services initially embraced password sharing as a marketing strategy to increase their audience reach. Reed Hastings, Netflix’s co-founder, famously stated long ago how shared accounts were not seen as detrimental to business growth. This sentiment has shifted dramatically, particularly after Netflix reported subscriber losses linked to extensive password sharing.
The impending crackdown is expected to evolve over time, with Max steadily honing its detection technology. JB Perrette outlined how the process will involve both explicit and implicit signals to improve password-sharing identification.
While some current customers of Max might grumble about the upcoming changes—considered by some as merely price hikes disguised as new policies—the service hopes to retain subscribers by offering highly anticipated releases alongside the rollout of these new policies. Exclusive shows, movies, and associated content launches may convince disgruntled users to stick around through the impending changes.
The ripple effect from Netflix's password-sharing restrictions appears to have opened the floodgates for other streaming platforms to reconsider their policies. The timing is coincidental yet reflects the increased industry momentum toward stricter controls on account sharing as companies scramble to maximize their subscriber base amid growing competition.
For those currently engaged with shared accounts, the rapid changes at Max may force some users to seek alternative streaming providers. This could mean moving over to platforms still allowing account sharing or opting to subscribe to multiple services to minimize costs.