The terms of service for Disney+, a streaming service that belongs to Disney, have changed, making it illegal for users to share subscriptions with people outside of their household. The company may limit or terminate access to accounts found to be sharing passwords, but the terms do not specify how these accounts will be identified. Disney+ accounts suspected of improper sharing will be given new features that allow their borrowers to start their own subscriptions. The updated terms will go into effect on March 14 for users with existing accounts, and new subscribers since January 25 have already been subject to them. Disney intends to start enforcing the new rules this summer.
Disney’s updated terms of service are nearly identical to those of Hulu and ESPN+, which were both announced on January 25. The new restrictions had been expected for months, and Disney CEO Bob Iger stated that the company was “actively exploring ways to address account sharing” as well as new streaming service price increases. Netflix tightened its streaming rules after experiencing its first subscriber loss in over a decade in 2022, and Disney+ has lost subscribers in four of the last five quarters, including the first quarter of 2024.
According to Nickie De Leon, a technology analyst at Consumer Reports, the trend towards tightening account rules is “natural.” He speculated that other industries, such as Costco, might follow in the footsteps of Disney and other streaming services. Other streaming platforms limit the number of concurrent streams and allow up to six people to share subscriptions, but they lack the location restrictions that Netflix pioneered.
The challenge that businesses face when transitioning to strict account-sharing enforcement is making their service worthwhile for customers without losing them completely. According to De Leon, if consumers are given a choice, such as optional, tiered pricing systems, they may be more willing to swallow the pill of account restrictions. While consumers will likely tolerate the changes in the long run, there will be growing pains if they are accustomed to doing something and then are suddenly unable to do it.