Most of us would be lying if we said we never gave a desperate friend our Netflix password to watch Orange Is the New Black. Though the practice of sharing passwords is frowned upon — and probably a fine-print no-no in those terms of service no one reads — it’s widely accepted as something everyone does. Netflix even lets you create different user profiles so the taste of people who use your account doesn’t affect your personal Netflix suggestions.
It turns out, sharing a password to Netflix, HBO Go, Hulu or your streaming service of choice is a federal crime. According to the U.S. Court of Appeals for the 9th Circuit, sharing passwords without the authorization of the system’s owner is a crime that’s punishable under the U.S. Computer Fraud and Abuse Act. No user can circumvent a network’s security system by “going through the back door and accessing the computer through a third party” which is exactly what you’re doing when you login as your boyfriend on Hulu.
The ruling comes from an unrelated case where an employee left a company but kept passwords, then used those passwords to access a client list and create a firm of his own.
The U.S. Computer Fraud and Abuse Acts spans beyond just streaming services. The ruling also makes it illegal for someone to login to your Facebook account. This means that every teen who’s angry that their mom or dad is snooping on their social networks has a case the federal government can technically prosecute but probably doesn’t really care about.
There’s no word on whether or not streaming services will attempt to prosecute users who share passwords, but it’s looking rather unlikely. Not only does it seem like a bad PR move, but surely you can’t punish that many people at once. The government has bigger fish to fry.
In a study published by research firm Parks Associates, it estimated that streaming services would lose $500 million in revenue from password-sharing in 2015, but Netflix still doesn’t seem so concerned. CEO Reed Hastings addressed the problem in January of 2016 when he said that most people piggybacking off of other users end up getting a paid subscription of their own. It’s somewhat of an unorthodox free trial.
“We love people sharing Netflix whether they’re two people on a couch or 10 people on a couch,” Hastings told Tech Crunch. “That’s a positive thing, not a negative thing.”