Warner Bros. is set to crack down on password sharing on its streaming platform Max, joining a plethora of other companies and platforms that are trying to counter the issue.
The latest development marks Max joining others, such as Netflix and Disney+, to crack down on users sharing their accounts with people outside of their households. Warner Bros. Discovery is now joining the wagon and implementing various password-sharing guidelines for its streaming platform.
Max's Password-Sharing Crack Down
While there is still little information that has been shared regarding the details of the crackdown, CEO and President of Global Streaming and Games at Warner Bros. Discovery, JB Parrette, confirmed that the company will start rolling out new restrictions to the streaming platform in late 2024. His remarks were made at Morgan Stanley's Technology, Media & Telecom Conference on Monday.
The new restrictions are expected to completely roll out and be implemented by 2025. Max is a hybrid platform that combines HBO Max and Discovery+ to create a streaming platform that offers users original programming, award-winning HBO programs and movies, and a massive collection of reality television content, as per Entrepreneur.
The company posted a net loss of $400 million in the fourth quarter of 2023, noting a 14% decrease in linear television advertising revenue as well as a 17% decrease in studio revenue. In an earnings call, CEO David Zaslav said that the business is not without its challenges.
He noted that among these challenges is that they continue to face the impacts of ongoing disruption in the pay-TV ecosystem as well as a dislocated, linear advertising ecosystem. He said that they are challenging their leaders to find innovative solutions to the problems at hand.
The company's password-sharing restrictions are part of a much larger plan to make streaming a profitable investment for Zaslav. This includes expanding Max into new international markets, such as France and Latin America, in the next year and a half.
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Implementing New Restrictions
Netflix first started cracking down on password-sharing last year and Disney recently informed its users of Disney+ and Hulu that it would convert suspected account sharers to paid subscribers, according to Wired.
In an email in February, Disney notified these users that their terms of service would be changing and that the sharing of login information with any person outside of their household would be banned starting on Mar. 14.
The new implementations come as providers continue to struggle to hand on to their user bases and streaming becomes a more crowded field. This has forced consumers to make tough choices about which services they decide to keep based on which ones they can afford.
Warner Bros. Discovery added 1.8 million subscribers in its direct-to-consumer division in its fourth quarter for a total of 97.7 million. The DTC's segment's results include Max, Discovery+, and traditional HBO cable subscriptions.
Netflix said in its quarterly shareholder letter in January that the company's "normal course of business" will allow it to grow and more effectively penetrate an addressable market of roughly 500 million connected TV households, said The Wrap.
