The streaming industry’s password-sharing crackdown has claimed its next victim — Warner Bros. Discovery’s (WBD) Max streaming service.
The platform formerly known as HBO Max will begin to restrict the practice later this year with a wider rollout expected in 2025, Yahoo Finance confirmed.
The news, first reported by Bloomberg, comes as media companies face pressure from shareholders to scale their streaming services and make them profitable.
Streamers can boost their subscribers by squashing password sharing, assuming the move doesn’t turn users off to their services. Ideally, it forces users sharing accounts to get their own subscriptions instead.
WBD’s latest move echoes the strategy of Netflix (NFLX), which began implementing its password-sharing crackdown for US subscribers last May after first announcing the initiative in October 2022.
“I’m conscious of not over-selling [the password crackdown] because you see Netflix’s success,” JB Perrette, head of global streaming & games at Warner Bros. Discovery, said at Morgan Stanley’s media and telecom conference on Monday.
“But Netflix was in market for 17 years. That means people are sharing passwords for 17 years,” he continued. “We’ve been in market for four, if you count the HBO Max launch. And obviously, we’re not quite at the same scale, but relative to the scale of our business, it’s a meaningful opportunity.”
Disney has also announced password-sharing crackdowns in recent weeks. Last month, the company sent notices to Disney+ users warning that it will begin to limit account sharing beginning in March. The announcement came just days after Hulu sent a similar notice to subscribers.
The strategy could help protect against slowing growth as recent reports point to a slowdown in overall streaming subscribers.
According to subscription analytics platform Antenna, subscribers to premium subscription services grew at their slowest pace since before the pandemic began, rising just 10.1% last year compared to the 21.6% seen in 2022.
On top of slowing growth, churn — or subscribers canceling their streaming plans — has nearly tripled since 2019 with 140.5 million cancellations in 2023, the largest drop in subscribers over the last five years.
WBD for its part already turned a full-year streaming profit in 2023. It’s the first media company, besides Netflix, to reach that milestone.
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at [email protected].
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