Disney+ to Enforce Strict Measures on Password Sharing from June, Announces Bob Iger

Disney+ is set to crack down on password sharing, following in the footsteps of Netflix. CEO Bob Iger announced during an interview that Disney will be launching its “first real foray into password sharing” in June. The rollout will initially begin in a few countries before expanding worldwide by September. The move is part of Disney’s efforts to increase signups and revenue, with the goal of achieving double-digit margins for the streaming business.

Last year, Disney warned subscribers about upcoming restrictions on password sharing, but did not provide specific details on how it would be implemented. CFO Hugh Johnston also mentioned the crackdown during a February earnings call, stating that those suspected of improper sharing would be given the option to sign up for their own subscription. Additionally, Disney plans to allow account holders to add people outside their household for an additional fee, although the exact amount has not been disclosed.

It is expected that Disney will adopt a similar approach to Netflix, which began cracking down on password sharing last year. Netflix allowed users to transfer the account to a new membership or pay $7.99 per month for an extra member outside their household. This move helped Netflix add nearly 22 million subscribers in the second half of 2023.

Disney recognizes Netflix as the “gold standard in streaming” and hopes to achieve similar success. Currently, Disney’s terms of service prohibit customers from impersonating someone else by using their username or password, although these terms have not been strictly enforced.

In March, Hulu, another streaming service owned by Disney, updated its user agreement to restrict account sharing outside of households. Users were warned that these new limitations would be enforced starting in March.

Bob Iger’s announcement about password sharing enforcement comes just one day after Disney won a proxy battle against activist investors who were seeking seats on the company’s executive board. The victory was seen as an endorsement of the board and its handling of CEO succession, a concern among shareholders.

Following Iger’s comments, Disney shares saw a slight increase in morning trade. Overall, Disney shares have risen about 30 percent this year.

In conclusion, Disney is taking steps to crack down on password sharing on its Disney+ streaming service. The company aims to increase signups and revenue, following the success of Netflix’s similar approach. This move comes after warnings to subscribers and updates to Hulu’s user agreement. Disney’s CEO sees the enforcement of password sharing as a crucial step in the company’s growth strategy.