Oh casual millennials, throwing their parents’ Netflix accounts like candy with little regard for the trouble this might cause.
As a study we took last year shows, the majority of people who share their password are younger audiences who likely never have subscribed to a service themselves. Most consumers who borrow passwords are using their parents’ accounts.
Last week, the U.S. Ninth Circuit Court of Appeals ruled that under the CFAA (Computer Fraud and Abuse Act) those who share their passwords are breaking federal laws (h/t Fortune).
Ok, ok… you probably won’t go to jail for sharing your streaming service accounts, as we highly doubt Netflix, HBO and Hulu are in a hurry to lock up their subscribers, not exactly a good look, and we’re guessing the negative press. The case at hand is more specifically framed around trade secrets acquired through unauthorized access to proprietary accounts.
But… what a case like this ends up doing is setting a precedent for future cases, where password sharing might become the cornerstone of an argument about violations of a service’s terms of service. Remember how the MPAA and the RIAA went hard after people who were downloading movies and music illegally? They ended up being the acting agent in all of these lawsuits on behalf of the record industry companies. It doesn’t seem impossible that perhaps in time a collective body of streaming services could send menacing letters to those who are violating the password sharing rules.
We definitely feel like it’s pretty unlikely that these streaming services would ever plan on being so aggressive about such usage, in fact most of the services comment about how password sharing is often times one of their biggest marketing channels. Users who borrow streaming service passwords often times end up becoming subscribers themselves. Cutting off this relatively low cost acquisition channel doesn’t seem like a good long term strategy in order to create short-term subscription growth.