After the HBO Max media blitz, a new industry group (one that counts Disney+, Netflix, Amazon, and HBO Max as members) quietly started a new working committee to crack down on password sharing and piracy. While the streaming wars rage, the big players in the industry are in a zero-sum competition for market share. However, when it comes to piracy, the major streaming providers are putting up a united front.
Once upon a time, file-sharing platforms like Napster were the digital boogeymen of Hollywood. And while file-sharing and pirated movies are still a major problem, streaming platforms face an even bigger threat to their bottom line: password sharing. In 2016, a U.S. Appeals Court ruled that password sharing may be a violation of the U.S. Computer Fraud and Abuse Act. Even if password sharing is in a legal gray area, it certainly violates many streaming providers' terms of service. However, until recently, big players like Netflix largely looked the other way when users blatantly passed around passwords with friends, family, roommates, neighbors, distant relations, and anyone else who asked nicely. However, as new fronts open up in the streaming wars, that might be starting to change. Soon, the time of carefree password sharing may come to an end.
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The Hollywood Reporter shared new details this week on the Alliance for Creativity and Entertainment, or ACE. Following the HBO Max unveiling, ACE quietly announced a new working group to address password sharing and other forms of piracy 2.0. Password sharing allows an unknown number of "free riders" to stream Netflix shows for free. With so many new streaming providers entering the marketplace, industry leaders know that most consumers can't afford to pay for Disney+, Netflix, Amazon Prime, Hulu, HBO Max, Apple TV+, and other streaming providers. As such, ACE is taking proactive steps to crack down on the newest form of piracy. Since ACE's launch in 2017, it's successfully fought some particularly egregious streaming piracy websites. Now, the group may be preparing to tackle password sharing in earnest.
ACE is an industry lobbying group in the vein of the MPAA. The entertainment industry is one of the largest industries in the United States, and entertainment represents one of the country's biggest exports. Unsurprisingly, the streaming industry is looking to protect its considerable assets. One Reuters/Ipsos poll found that one-in-five young adults borrow passwords (from people who don't live with them). From the perspective of companies like Apple, Disney+ and Netflix, password sharing could very easily be considered password stealing. Plus, for every young person that admits to password sharing, there may be many more who keep that information to themselves.
What does that mean for consumers? Recently, several popular (and illegal) streaming websites were shut down. Now, Netflix, Disney+, and HBO Max will be joining forces to crack down on rampant password sharing. HBO Max and Disney+ may be preparing to compete with Netflix, but the companies are now quietly working together to find solutions to their common problem. For viewers accustomed to logging on with a friend or family member's password, the days of free streaming may be numbered.