Disney+ is gearing up for its crackdown on password sharing, with subscribers notified of an update to the platform’s terms and conditions.

After Disney CEO Bob Iger announced last year that the company was “actively exploring ways to address account sharing”, Disney+ notified subscribers last week that plans are being put into motion.

The streaming service’s ‘subscriber agreement’ now reads: “Unless otherwise permitted by your Service Tier, you may not share your subscription outside of your household.”

Disney+ defined ‘household’ as the collection of devices associated with an account owner’s primary personal residence.

Attempts to find a way around the new limitation could result in Disney+ limiting or terminating access to its streaming service.

No specific date has been given as to when Disney+ password sharing will become restricted in Australia, but the update to the subscriber agreement indicates the change will come soon.

Iger previously said making the change was a “real priority” for the company, and there will be “some impact” in 2024.

Netflix setting the trend

The move from Disney+ follows Netflix, which dropped the hammer on password sharing last year.

While this was met with a vocal backlash on social media, it paid off for Netflix, with the streaming service seeing the number of new subscribers exceeding account cancellations over the second quarter of the year.

The update to the Disney+ subscriber agreement specifically restricts password-sharing unless “otherwise permitted by your Service Tier” – which indicates the platform could further imitate Netflix by allowing subscribers to share their password as long as they pay for the privilege.

Victoria University senior lecturer in screen media Marc C-Scott said the the move by Disney+ is part of the streaming industry’s habit of watching what Netflix does, and following suit if the company succeeds.

This has already been seen with the rapid uptake of ad-supported subscription tiers, which Netflix is largely credited with kicking off.

“[Streaming services are] looking at their subscriber numbers, and there are only so many subscribers you can actually get; you sort of reach that tipping point,” C-Scott said.

“So you then need to start looking at other ways [of making more] revenue.

“Anyone who takes a lead on something like this is always going to suffer a bit of backlash, but they’re providing a product … and so they’re in their right to ask for people to pay for the service.”

Whether people can afford to pay for that service is another matter.

Tactics to boost subscribers

Cost-of-living pressures are biting into household budgets, and with services including Disney+ hiking the cost of subscriptions last year, Australians could grow more selective about their streaming services.

Australians could also be tempted to turn to online piracy, with a 9 per cent increase in Australians consuming at least some digital content through illegal methods between 2021 and 2022.

C-Scott anticipates subscribers will move between streaming services and respective subscription tiers over the next 12 to 18 months, especially if interest rates continue to rise.

The pressure is also on for streaming services to make sure their content is up to scratch to keep subscribers, and entice new ones.

Last year’s months-long actors’ and writers’ strikes will have a big impact, with many new productions to arrive later than expected, and releases to be split up to keep subscribers coming back for more.

For example, although production ended in March 2023, the third season of Netflix’s Bridgerton will be released in two parts this year; first in May, then in June.

“Netflix really has to think about ‘Well, how do we hold on to those subscribers for the next 12 months?’,” C-Scott said.

“And that really means thinking about, ‘Where are we going to put our prime programs and launches to hang on to subscribers right through the year?’

“And that’s not just for Netflix, that’s for all of those streaming services.”