Netflix plans to unveil new pricing model, subscribers may have to pay more

Streaming giant Netflix said on Wednesday that it is testing charging a fee to subscribers who share their accounts with people who don’t live in their homes.

The US-based streaming service until now had no pricing policy for users sharing passwords with family or friends, but recently its stock fell on quarterly results, indicating cooling subscriber growth.

Meanwhile, competition in the OTT (Over The Top) market has been growing, with the cost of producing original shows climbing as well. Netflix will begin offering subscribers in Chile, Costa Rica and Peru the option to add as many as two people to “sub-accounts” at a monthly fee of $2 to $3.

"We recognise that people have many entertainment choices, so we want to ensure any new features are flexible and useful for members, whose subscriptions fund all our great TV and films,” said Chengyi Long, product innovation director, Netflix, in a blog post.

The company has been working on ways for subscribers to share “outside their households while also paying a bit more,” she said.

Long added that the company will study the utility of the new model in the three countries before making changes anywhere.

Most of the 8.3 million subscriptions added at the end of last year came from outside North America, according to the streaming service.

Netflix recently announced an increase in subscription prices in the US, with the basic option now costing $9.99, and the most expensive going up to $19.99.