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Is Netflix really stopping password sharing? Here's what its new rules say

On Wednesday, Netflix disclosed its new password-sharing policy. Will you boot your friends from your account?
Written by Sabrina Ortiz, Editor
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Image: Patrick T. Fallon / Getty Images

At the end of January, Netflix said it would crack down on password sharing. And on Wednesday, Netflix announced its plan to put its no-sharing policy into action. Before you run to change your password and boot off all your friends, keep in mind the consequences are basically nonexistent.  

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According to the new policy, you will only be able to share your password with those who live within the same household as you, the "Netflix household". If you are thinking, 'How will they know?', then Netflix is one step ahead of you. 

The streaming company will use information such as IP addresses, device IDs, and account activity from devices signed into an account to make sure it belongs to the same household. 

If a device outside of your household signs into an account or is constantly used, Netflix will notify the phone number and email associated with the primary account to verify the sign-on. 

Just because you verify it doesn't mean that Netflix will always grant access to that account. You may repeatedly be asked to verify the account and raise suspicions with Netflix that might lead to further action from the company. 

Netflix has yet to disclose actual consequences but has been testing an opt-in feature that allows Netflix users to pay more for additional accounts added to the primary account in Chile, Costa Rica, and Peru. So if you push your luck with Netflix account sharing, it is a possibility that they will end up charging you extra. 

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If you are traveling, no worries -- as long as you are the primary account holder or live with them, Netflix says you won't need to verify your device. However, if you are away for an extended period of time, then you will have to. The biggest losers when this new policy is enforced will be college students who are away at schools and can no longer use their parents' accounts. 

This isn't Netflix's first attempt to raise revenue. Last year, Netflix introduced a new ad-supported subscription tier following continuous subscriber loss. 

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