Disney has issued a formal notification to its Disney+ subscribers, indicating a new era in the management of streaming service accounts. In alignment with a strategy announced by Disney CEO Bob Iger, the entertainment giant is taking steps to monetize and manage the widespread practice of account sharing. In recent communications to Canadian subscribers, and soon to be addressed to the US audience, Disney Plus terms and conditions have been overhauled to clarify the limitations on password sharing.
“Unless otherwise permitted by your service tier, you may not share your Disney Plus subscription outside of your household,” the notification reads, signifying a decisive move towards stricter enforcement of the company’s streaming policies.
This initiative follows Disney’s ongoing updates to subscriber agreements. Which now defines a household as “the collection of devices associated with your primary personal residence that is used by the people who live there.” The new stipulations underscore the company’s intent to limit or discontinue service if terms are violated.
In his statement on the company’s quarterly earnings call on August 9, Bob Iger indicated Disney’s commitment to exploring solutions for account sharing. “We are actively exploring ways to address account sharing and the best options for paying subscribers to share their accounts with friends and family,” said Iger.
So, Disney undoubtedly anticipates a similar outcome now. The new terms of service, are currently applicable to all new subscribers of Disney’s platforms. And for the current subscribers, it will come into effect on the 14th of March.
The company has outlined that it can “analyze the use of your account to determine compliance” with these updated rules. While the exact methods for monitoring compliance have not been unfolding, industry speculations suggest that Disney Plus might adopt an approach similar to Netflix’s. Which involves setting a primary location for the household that’s linked to the home broadband network. Instances of streaming outside this designated location could prompt a notification to the account holder. This notification will provide the opportunity to enhance their Disney Plus subscription by adding additional paid members.
During a February 7 call with shareholders, Disney’s Chief Financial Officer, Hugh Johnston, indicated that the company would implement a similar framework, stating, “Later this calendar year, account holders who want to allow access to individuals from outside their household will be able to add them to their accounts for an additional fee.”
The crackdown on Disney Plus’s password sharing is part of a broader movement among streaming services. Notably, Netflix has also adopted comparable policies to address this issue earlier in the year.
Netflix has remained firm in its stance, acknowledging the possibility of an initial drop in subscriber numbers. However, they emphasize that the policy shifts are strategically planned to bolster long-term gains. The company anticipates that these changes will pave the way for greater investment opportunities and a stronger revenue stream.
And it happened as expected! Despite the added costs, Netflix gained over 30 million new subscribers, surpassing the previous year’s figures. By limiting access for non-paying users, the company successfully trimmed unauthorized password sharing, ultimately contributing to its significant overall subscriber surge and reaffirming its position in the streaming market.
Starting November 1, Disney Plus is set to introduce an ad-supported subscription plan in Canada, priced at $7.99 per month. This plan will also be available in the U.K. and several European countries. This new tier aims to provide additional options for viewers while aligning with the company’s revised sharing policies.
Disney’s proactive communication strategy aims to prepare subscribers for the upcoming changes and ensure compliance. The company is positioning itself to enhance the value of its streaming service while addressing the challenges of account sharing in a rapidly evolving digital entertainment landscape.
For additional information on Disney’s updated policies and the official launch date of the new restrictions, please stay tuned for future announcements from the company.
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