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Since Chat GPT exists, almost every student has experienced working with Gen AI Tools. Besides summarizing academic articles, researching, or getting explanations on topics I have worked with Chat GPT for coding.

During my exchange semester, I had a course about the introduction of Python. The course was lecture-based so there were only limited possibilities to ask personal questions about the code. Due to the fact that we had to upload assignments I had to understand the exercises and the code. Therefore, I started working with Chat GPT and let the Gen AI tool explain the theory about the codes.

On the one hand, it was very helpful to me since I could ask back and forth with Chat GPT about the code and get an explanation line by line of what the code means and why it is necessary. Moreover, I received help with exercises and got parts of the code I needed. Lastly, I used the tool to fix bugs in my code. On the other hand, I experienced that it was very tedious sometimes to get to the right answer or code because Chat GPT often did not understand the questions properly or wrongly interpreted the data set behind the code and gave wrong answers then. Additionally, the code generated by Chat GPT is very often too long or extensive and could have been summarized into fewer lines. Lastly, the code had some bugs in it, and even though I wrote that in the Chat no good corrections came out of it.

To sum this up, I would say that Chat GPT really helps with the coding process and can especially help with explaining the code or fixing bugs. However, solely relying on Chat GPT and just writing the code with the tool did not work for me and I would not recommend it.

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The streaming platform Netflix announced in 2023 that the sharing of passwords will be more restricted. The goods offered by Netflix are typically characterized as Information goods, which means that the initial setup of the platform and the movies themselves cost money, but the creation of each additional account costs nearly nothing for Netflix. However, every newly created account translates directly into revenue for the company.

What happens then for Netflix if users start sharing their accounts? That was the case in previous years, and Netflix lost significant revenue as users would share accounts instead of subscribing individually. In response, Netflix implemented stricter controls on account sharing, and many analysts did not predict any significant changes.

But on the contrary, Netflix saw a significant increase in revenue. According to reports, once sharing was restricted, many users who previously accessed the platform via shared accounts signed up for their own. In the first quarter of 2024, Netflix added nearly 9 million new subscribers globally. As a result, they have reached a record high of 269.6 million subscribers and underscored the effectiveness of the new policy.

This new policy raises an interesting question: Is protecting separate accounts a new important characteristic for Business Models that are based on the subscription-based model in order to gain the highest possible revenue?

For Netflix, the answer seems to be yes. By setting up stricter controls on shared accounts, Netflix transformed lost revenue into new subscriptions, demonstrating that limiting access can actually create additional revenue.

But from my point of view, newer companies entering the market and do not want to offer a Freemium model but solely offering a subscription-based model should not heavily focus on the restriction of password sharing in the beginning. The reason for me is that users start to see the real value of a platform by using it and the newly gained subscribers of Netflix could be a result of previous entrainment and the knowledge of what that platform has to offer. That is why platform sharing could also benefit companies in the beginning and the restriction should be focused on in a later stage.

In conclusion, restricting the shared use of digital services could represent a key characteristic of the subscription-based model. By ensuring that each user subscribes individually, companies can tap into previously unrealized revenue without significant additional costs. But firms should focus on the value creation and user acquisition first and ensure that the value is on the highest level.

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Reference:

Delouya, S. (2024, April 19). Netflix cracked down on password sharing. The result? Millions of new subscribers. CNN Business. Retrieved September 12, 2024, from https://edition.cnn.com/2024/04/18/business/netflix-earnings-first-quarter/index.html