A household Netflix account comes with its share of difficulties. Basic streaming plans only allow for one video to be streaming at a time, per account. That means that Daddy may be watching Californication on his laptop but little Susie wants to watch Dora the Explorer on the TV. Susie can’t do that, she starts crying, chaos ensues and the night is ruined. Let’s not even go into the scenario of the girlfriend who can’t watch Glee because her boyfriend is hooked on Sons of Anarchy (too personal).
Netflix may be looking at a way to make accounts more personal by shifting their focus to individual memberships. Basically, the company hints that it might be developing more options for multiple streaming accounts.
As of now, Netflix offers a stream-only plan that costs $7.99 a month. Subscribers get one video at a time per account with that plan. People who get the one-DVD a month plan can still stream with limits, but only one at a time. Currently, multiple streams are offered to those who pay for multiple-DVD plans, but those can get a tad pricey.
In a statement on the Netflix Investor Relations FAQ, the company hints that later this year they may be offering more account options for multiple streams. This would be part of the “individual membership” approach, which would obviously be tailored more towards specific viewers. Another part of “individual memberships” would most likely be personalized recommendations that don’t factor in what little Susie watches when determining a suggestion for Dad.
Google+Reader”>Hacking Netflix first spotted this statement deep in the FAQ. It’s not very specific but it definitely looks like Netflix is going to be changing the streaming options sooner rather than later. The FAQ statement:
When our focus was primarily DVD rental, we talked about our opportunity in terms of households, in particular the number of households with broadband access, which is more than 70 million households. Another way to view our potential opportunity is to consider the number of households that subscribe to home entertainment, which includes cable and satellite subscribers, a market estimated at about $68 billion in annual revenue. In either case, we were describing a very big potential market, giving us a lot of room to grow.
More recently, as streaming has become central to our business, we believe there may be an opportunity to change our focus from a household relationship to an individual relationship, since streaming is viewed on personal devices, such as phones, tablets, and laptops, as well as on shared large screen televisions. As we think about this shift from a household to a personal relationship, we are starting to think internally that our opportunity could be viewed as the number of mobile phone subscribers, a group that both invests in electronic content and can afford $7.99 for home entertainment. Needless to say, that is a large opportunity.
The evolution toward individual memberships will take time, and we are still thinking about how to best do it. One option would be to allow an account to add additional concurrent streams (using the analogy of our DVD business, it would be like choosing a higher-priced plan that allows a subscriber to have more DVDs at home). Our $7.99-per-month plan is for one stream at a time, and later this year we expect to be able to offer consumers some account options to watch multiple simultaneous streams. Or it could be that there is a price point that would encourage multiple accounts in one household. In either case, our long-term goal is to evolve the Netflix service so that it feels more natural to have a personal account. We will also be working on broader Facebook integration which we hope will further the notion of personal accounts.