SAN FRANCISCO: The world's largest streaming service, Netflix, is reportedly cutting USD 300 million from its budget this year, including for hiring.
A recent report from The Wall Street Journal claims that one of the causes of the spending reduction is the fact that Netflix postponed its plans to crack down on password sharing from this year's first quarter to the second quarter. This implies that the revenue that Netflix expected due to the change will now occur in the second half of the year.
The report also stated that there will not be a hiring freeze or further layoffs. "The company urged staff earlier this month to be sensible with their spending, including in relation to hiring," it said.
Earlier this year, the streaming service started cracking down on password sharing in Canada, New Zealand, Portugal, and Spain. This summer, Netflix will finally crack down on password sharing in the US.
In the US, Netflix had initially intended to introduce "paid sharing" in the first quarter of this year. The functionality will now be unveiled by the company on or before June 30. It allows up to two additional users per account, and the cost per additional user varies by nation.
The sharing plans are available to members using Standard (USD 15.49 a month) and Premium (USD 19.99 a month) subscriptions. 'Basic with Ads' is the name of a new ad-supported plan that the firm introduced last November. The monthly fee for the tier is USD 6.99.
Netflix is also upgrading its ad-supported strategy in terms of streaming quality and concurrent streams. Netflix also slashed staff last year in an effort to reduce costs.
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