Australians using a friend or family member’s Netflix account will now have to pay for it as part of a worldwide password crackdown by the streaming giant.

Netflix on Wednesday sent an email to subscribers who are currently sharing their account outside of their household informing them that this is no longer allowed.

Users will be given the option to either pay an extra $7.99 per month to allow for an extra member outside of their household, or to transfer these users onto their own membership which they will pay for.

“A Netflix account is for use by one household,” the email from Netflix said.

“If you want to share Netflix with someone outside of your household, you can use these features.”

The crackdown has been looming over Australian users for several months, after it was rolled out in New Zealand, Portugal, Canada and Spain in February.

It marks another effort from Netflix to turn around its dropping subscriber count and reach profitability.

It is a big switch from its previously turning a blind eye to the practice of password sharing, and even actively encouraging it.

In 2017, the official Netflix account tweeted that “love is sharing a password”.

Netflix has previously claimed that there are 100 million households using shared accounts, and that this is impacting the company’s “ability to invest in great TV and films”.

Netflix will be using the IP address of a user’s home to determine which devices using the same password are in the main household and which are in another location. Those in another location will no longer be able to use the same account without paying extra.

A user can also manually set their main household.

It will still be possible for the main account holder to use Netflix in another combination through a combination of the use of IP address, user details and one-time access codes to validate their identity.

A standard Netflix account holder, who is already paying $16.99 per month will be able to add one extra user for $7.99 per month, while a premium user who is paying $22.99 per month can add two users for the same price each.

The same password sharing crackdown was also launched this week in the US.

It was first announced in April last year after it was revealed that Netflix had seen an overall reduction in its subscribers for the first time in a decade.

Netflix lost 200,000 subscribers in the final quarter of 2022.

According to the Consumer Survey on Online Copyright Infringement 2022 report, a quarter of all respondents engaged in “some kind of account sharing activity”.

The tactic has proved to be effective so far in the countries it has been rolled out in, leading to increased revenue and subscriber numbers.

In a shareholder letter earlier this year, Netflix said that there is a “cancel reaction” in a market when news of the password crackdown is announced leading to a short-term reduction in users, but this is more than offset by an increase in subscribers as “borrowers start to activate their own accounts and existing members add ‘extra member’ accounts”.

In another effort to reverse its fortune, Netflix late last year launched a cheaper $7 monthly subscription tier that includes advertising.