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Cable companies are looking for ways to limit password sharing

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TV Everywhere

Cable companies are over people sharing logins with all their friends and family. As first spotted by Bloomberg, Charter CEO Tom Rutledge said at the annual UBS conference this month: “There’s lots of extra streams, there’s lots of extra passwords, there’s lots of people who could get free service."

Charter has made cracking down on password sharing a priority during negotiations with channel providers. Bloomberg reports that the company requested Viacom help limit password sharing by reducing the number of simultaneous streams allowed on its apps. Rutledge tells Bloomberg that channel owners bear most of the blame for the current cable situation. They don't secure their apps and, he says, “they devalued their own product in a dramatic way."

Meanwhile, ESPN tells Bloomberg it wants to work with channel distributors to verify subscribers whenever there are a large number of people streaming through the channel's app.

Companies have already started cracking down on shared passwords. Netflix limits users to two simultaneous streams, unless they pay for an upgraded plan that allows for four. ESPN now only allows five streams from its app and is reportedly considering dropping that number to three. It used to be 10.

Cable and satellite companies appear to be having a particularly hard time grappling with password sharing, given that they're continuously losing subscribers and revenue. The TV industry’s losses from password sharing are expected to rise to $9.9 billion by 2021, according to Bloomberg and research firm Parks Associates.

Netflix and online-first platforms, like YouTube TV and Hulu, build the cost of simultaneous streams into their service. So you'll pay more for those extra devices, whereas the option doesn't exist with cable and the various channels' websites and apps. It's disjointed.

Netflix CEO Reed Hastings previously said in 2016, “Password sharing is something you have to learn to live with, because there’s so much legitimate password sharing, like you sharing with your spouse, with your kids, so there’s no bright line, and we’re doing fine as is."

So enjoy this password sharing utopia now because it might not last much longer, although I do believe the internet will always find a way to get content for free.