A worldwide crackdown on the sharing of passwords across Disney’s streaming service will kick off by September, a year after its rival Netflix did the same.

Disney CEO Bob Iger revealed in an interview with CNBC last week that the company will be trialling efforts to prevent users from sharing their passwords for streaming services such as Disney+, Hulu and ESPN+.

In the interview, Iger said that Disney will be “launching [its] first real foray into password sharing” enforcement in “just a few countries in a few markets” in the upcoming months, before it will “grow significantly with a full rollout in September”.

Disney has so far refused to reveal which countries will be targeted in the password sharing crackdown first, and when Australian subscribers will be subject to it.

The effort is aimed at preventing subscribers to Disney’s streaming platforms from sharing their password with people outside of their house, giving them free access to the services.

Earlier this year Disney put into effect a rule for new subscribers banning them from sharing their password, with this applied to existing members from 14 March.

Netflix pioneered crackdown

It comes after Netflix made a similar crackdown on password sharing last year, which it has credited with a significant uptick in subscribers late last year.

Iger has openly admitted that Netflix is leading the way when it comes to streaming, and that the new crackdown is to “turn this business into a business that we feel really good about”.

“We need more success,” Iger told CNBC.

“Netflix is the gold standard in streaming. They’ve done a phenomenal job. I actually have a very, very high regard for what they’ve accomplished.

“If we can only accomplish what they’ve accomplished, that would be great.”

Under the crackdown, users who are sharing their password outside of their house will first be sent an email warning.

They will also be asked if they want to pay extra to continue allowing the extra person to use the password, with that person also offered a separate subscription.

This is the same way that Netflix cracked down on people sharing passwords last year.

At the time, Netflix reported that 100 million households were sharing Netflix passwords around the world, something which was “impacting [its] ability to invest in great new TV and films”.

Down under

The crackdown was put in place in Australia in May, with users having to set a “primary location” with Netflix checking the IP address to make sure that people logged in from their primary residence.

Users were then given the option of paying an extra $7.99 per month to allow for the extra member, or to transfer this person onto a new membership.

This coincided with the launch of a new, cheaper subscription level for Netflix that included advertising.

Disney is yet to reveal how much it will cost to add a new user to a streaming account, or if any new subscription tiers will be launched.

The password-sharing enforcement has been credited with leading to a major boost in global subscribers for the streaming giant, with 13.1 million people around the world signing up in the last three months of 2023.

This was the third quarter of growth in a row, with Netflix hitting more than 260 million global subscribers by the end of last year.

This represented an annual increase of nearly 30 million subscribers, far above the 8.9 million subscribers added in 2022.

Disney is seeking to reach “double-digit margins” in the long-term and is striving for its streaming business to reach profitability by the end of the 2024 US fiscal year, which is the end of September.

Disney’s direct-to-consumer streaming business unit posted a loss of $US138 million in the year ending 2023 quarter, down from a loss of nearly $US1 billion a year earlier.