Subscription mooching is a common practice in today’s streaming ecosystem where people borrow subscribers’ logins to access services like Netflix and Hulu rather than paying for them. To understand the magnitude of password sharing, the website, Cordcutting.com conducted a survey of over 1,000 people ages 18 to 81 to examine who is really paying for streaming subscription services. The new report, Subscription Mooching, shows that nearly 20% of users of the major streaming services are borrowing logins from subscribers.
According to the research, 19% of Hulu viewers use someone else’s login, as do 17% of Amazon Prime Video viewers, and 15% of Netflix viewers. Not surprisingly, parents are the most frequent source of shared passwords for Netflix and Amazon Prime (32% each, respectively) while significant others are the main source of password sharing for Hulu (26%).
The television landscape is changing with only 7% of viewers
subscribing to cable TV and 30% subscribing exclusively to video streaming
services for their media consumption. In total, approximately 68% of people use
cable TV and 92% use a video streaming service.
Of course, many streaming services allow simultaneous streaming on multiple devices. However, each treats the sharing of account credentials differently.
The amount that moochers avoid paying varies. On average, people borrow a Netflix subscription login for 26 months. At the lowest subscription plan price of $7.99 a month, a person can save $207. Interestingly, a login is borrowed for Amazon Prime Video for approximately 16 months, saving on average $144. A login borrowed for Hulu is used the shortest amount of time, approximately 11 months, saving an individual $88.
While sharing an account login can provide a consumer savings, it comes at a substantial loss for the streaming services. The research uses the difference between the total number of subscribers and the total number of users in order to project the potential revenue loss. According to this report, Netflix is losing approximately $192 million every month or $2.3 billion a year. Hulu and Amazon Prime Video average between $40 and $45 million in estimated losses each month or approximately $0.5 million per year, respectively.
Converting the Moochers
Trial usage appears to be a good source of conversion. Approximately 59% of people are willing to pay for their own Netflix subscription if they are no longer able to access a shared login. While significantly less than Netflix, 38% of Hulu and 28% of Amazon Prime users are willing to subscribe if they are no long able to access a borrowed login.
Login sharing does offer some retention value. It’s hard for consumers to cancel their subscription if they know others are relying on them for access. Marketing and retention factors aside, streaming services need to address password sharing in order to grow their market share, especially among millennial and generation X audiences.