Netflix will start automatically canceling inactive accounts

Netflix has started to terminate accounts that people haven’t used the service for a year or more.

The company announced that it is notifying customers who haven’t watched anything for 12 months since they subscribed whether they want to keep their membership. Netflix also is reaching out to those who haven’t streamed anything in the past two years.

If Netflix members do not confirm that they want to keep subscribing, the company said, it will automatically cancel their subscription.

Such inactive accounts represent less than 0.5% of its overall member base, representing “only a few hundred thousand,” Netflix director of product innovation Eddy Wu wrote in a blog post Thursday. The potential termination of those are already factored into its financial guidance, he added.

Once Netflix does terminate an inactive account, it will keep favorites, profiles, viewing preferences and account details for 10 months, so in the event someone decides to sign up again they can reinstate their accounts as they were.

Why is Netflix proactively chucking paying customers off its rolls? According to Wu, it’s a move aimed at generating goodwill, saying, “we hope this new approach saves people some hard-earned cash.”

To be sure, it’s also a brand-building exercise to send a message to all Netflix users that the company is being mindful of customers’ wallets as unemployment has skyrocketed. And at the same time, by prodding customers who haven’t watched anything in a long time, Netflix could successfully make them active viewers — and therefore more likely to stick around in the long run.

Netflix netted a record 15.8 million subscribers in the first quarter of 2020, although the company said it doesn’t expect the quarantine-fueled bump to continue long-term. CEO Reed Hastings told investors that subscriber additions in the second half of 2020 likely will be lighter versus the year-earlier period because of a “pull forward” of additions in the first half of this year.

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