From Fortune:

Disney has updated its terms of agreement to prohibit password sharing effective March 14, following in the footsteps of Netflix. The move comes after CEO Bob Iger stated that the issue was a “real priority” in an earnings call with analysts last August. CitiBank estimates that such sharing could cost the industry $25 billion annually. It is still unclear how many households are sharing their passwords.

The move could impact the streaming industry, considering the boost in sign-ups Netflix saw after ending password sharing. Observers initially wondered if the move would result in a user revolt, since Netflix initially encouraged users to share their accounts in a 2017 Tweet. However, Disney’s streaming business has lost $387 million in its fourth fiscal quarter, even with recent cost-cutting efforts.

The move comes after a Citibank report estimated that password sharing could cost the industry up to $25 billion a year. Meanwhile, Netflix revealed that more than 100 million households are using accounts paid for by other people.

Netflix’s success and subsequent boost in sign-ups has resonated with other streaming services. Observers initially wondered if the move would result in a user revolt, since Netflix initially winked at password sharing and was more interested in viewer numbers. The company even encouraged users to share in a 2017 Tweet.

Disney’s streaming business lost $387 million in its fourth fiscal quarter. That’s still considerably better than the previous year when it saw losses of $1.4 billion. Bob Iger has focused on the streaming service amid recent cost-cutting efforts.



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