Netflix's Crackdown on Account Sharing Repeats the RIAA's DRM Mistakes

Were you alive and purchasing CDs in the late 1990s and early 2000s? If so, Netflix’s new inane rules on account sharing might feel familiar. They’re frustrating, poorly designed, and encourage piracy. So why are they repeating past mistakes?

Shortly after the Digital Millennium Copyright Act (DMCA) was signed into law in 1998, Napster became the first widespread peer-to-peer download software. The word “revolutionary” is thrown around a lot, but it’s justified in this case. Any minimally computer-savvy person could use it and while viruses and malware were a concern, it didn’t matter so much back before online banking and identity theft became widespread. People shared millions of tracks. Some bands, like Radiohead, owe much of their success to the service while many rare B-sides and live performances found their way into the cultural zeitgeist for the first time. Independent and local bands got a worldwide boost in popularity. Other times it led to sharing of brilliant mashups like Danger Mouse’s The Gray Album, a seamless combination of Jay-Z’s Black Album with The Beatles White Album. Sometimes albums found their way to the service even before release. No longer would you drop $16 on a new CD in the hopes it would be good only to find that 10 of the 12 tracks were garbage. It was truly a magical time to be alive.

Record companies and big-name artists were unhappy. The Recording Industry Association of America (aka the RIAA, aka the Great Satan) hated any infringement on their profits. The industry implemented “Digital Rights Management,” or DRM, on the most famous artists’ releases in the hopes of curtailing piracy. It backfired in spectacular fashion. There was no single standard. Some DRM-protected CDs wouldn’t play on Windows computers at all. Others worked with PCs but only technically; playback consumed 100% of the available CPU and RAM and made it impossible to do anything else. Stopping the music didn’t release those resources, and home computer systems occasionally bricked after hard power. Some DRM could be bypassed with a black marker or sticky tape. Others were cracked via software within hours or days of an album’s release and shared online. It increased illegal downloads as fans sought ways to avoid the frustrating restrictions. Several grandmothers and learning institutions were sued for six-figure sums thanks to kids downloading tunes over their internet connections. Eventually Windows Media Player, iTunes, and then streaming services like Spotify and YouTube dominated the market and the conversation died away. The digital revolution became the digital mainstream. Piracy still occurs, of course, but it’s less of a necessity for the average viewer. This brings us to Netflix.

By now, Netflix’s intention to stop account sharing is old news. They claim over 100 million households improperly share their accounts with other people, and they consider that lost income though there’s no accurate estimate on how many of those shared accounts would become individual subscribers. A less-than-successful dry run in Costa Rica hasn’t stopped the streaming giant from staggering forward with plans to increase its subscriber base by banning account sharing by “multiple households.” Netflix’s definition of a household as people you live with rather than your immediate family raises a number of concerns, but as their subscriber numbers declined, Netflix was determined to push back.

The changes went up on Netflix’s US Help Center page earlier this week, and people weren’t happy. Essentially, subscribers would be required to use devices only attached to their home networks. Those registered devices have to check into your home network once a month to maintain access or risk being blocked. You will need to request a PIN code from Netflix to use a device outside of your home network while traveling — every 7 days. You can also choose to pay Netflix more money to share your account and access it on more devices, which feels like a cash grab to those of us already paying $16 every month for increasingly watered-down choices. With Stranger Things ending, The Witcher downgrading from Henry Cavill to a lesser Hemsworth, and what feels like a steady decline in original programming, it’s become more difficult to justify any price hikes.

Such ill-defined restrictions affect many subscribers who are following the rules. College students using their parents’ account. Deployed soldiers. Subscribers who watch on a desktop at work. People working abroad while their families remain at home. People who set up accounts for their elderly parents. The list goes on. Anyone using a network other than their own would have to jump through hoops to get access to media they already pay for.

A number of ways around the issue already exist, beyond the obvious one of paying Netflix more money. VPNs, proxy servers, and other IP address shenanigans will help most tech-savvy users avoid the problem, even if Netflix starts monitoring such workarounds more closely. Then there’s the other option; Privateer Lagoon. Corsair Cove. Marauder Estuary. You know what I mean. Despite the dubious legality of such a method it’s bound to become more popular should Netflix implement these changes. Particularly if the other streamers, who are no doubt watching closely to see how this affects Netflix subscriber numbers, follow suit.

According to The Streamable, Netflix has already backtracked, but so far, no other outlets have confirmed it. They say the spokesperson claimed the Help Center update was accidental, though it was more likely a test shot to gauge public response. The Help Center page detailing the changes remains active.

In the meantime, Netflix also made headlines for using AI-generated backgrounds due to an “artist shortage” that only exists because the anime industry as a whole notoriously underpays and abuses its talent. And contestants on Netflix’s real-life Squid Game reality show raised complaints about the “cruel” and “rigged” competition. While most of us might assume the cruelty was the point and that all reality competitions are rigged, it does sound like contestants were misled about what they would face. Either way, it’s more bad press for the struggling company.