Share Your Password, Go to Jail

A law criminalizing sharing with your family or friends your password to entertainment services like Netflix and Hulu Plus takes effect July 1st and is causing quite a stir for consumers. The new law, which acts to enhance the theft of services law already on the books, is meant to thwart hackers, according to Hollywood executives. But as written, the law appears over-broad.

The law lacks language specifically targeting hackers and/or commercial users. It therefore has the capacity to capture average Americans, like family members sharing a Netflix password over multiple devices such as a Playstation, a computer and an XBox. If a family member travels a lot and takes a console or a computer on the road, s/he may then violate the law because s/he's now shared the password with family members back home. Merely leaving home could trigger criminal liability.

As with many new laws recently implemented to protect a shrinking entertainment revenue base, this one has the potential to quickly spread nationwide. Before it does, it should be narrowly tailored to address the stated issue of hacking. Otherwise, consumers should expect litigation targeting the purses of Middle Class consumers.