Ralph Macchio discusses 'Cobra Kai' in 'Waxing On'. Details here

An unexpected drop in subscribers sent Netflix shares into freefall on Wednesday, forcing the company to consider experimenting with ads and -- hold onto your remote -- cracking down on millions of freeloaders who use passwords shared by friends or family.

Netflix said that about 100 million households worldwide — or roughly one out of every three households using its service — are streaming for free. "We’ve just got to get paid at some degree for them," co-CEO Reed Hastings said during a shareholder call held on Tuesday.

Netflix has already started experimenting in Latin America with programs that use a soft touch to convince the unsubscribed to sign up. In Costa Rica, for instance, Netflix plan prices range from $9 to $15 a month, but subscribers can create sub-accounts for two other individuals outside their household for $3 a month. On Tuesday, Hastings suggested that Netflix soon may adopt something similar in other markets as well.

Plan is in motion but just how Netflix will erect barriers remains unclear, and Hastings indicated that the company probably will spend the next year assessing different approaches to get the subscribers back. In one test last year, Netflix prompted viewers to verify their accounts via email or text. However, if asked to pay more or if Netflix ends password sharing, then it may push users to sign off.

Netflix is bracing for more subscriber losses even before it attempts to weed out freeloaders. The company predicted its customer base will shrink by another 2 million subscribers by the end of June. That would still leave Netflix with 220 million worldwide subscribers, still more than any other video streaming service.

Many now fear that a Netflix crackdown on password-sharing could encourage other streaming services to follow suit. For years, Netflix has looked the other way at the not-so-secret practice of users sharing account passwords beyond their households, and Hastings has often spoken passionately in the past about keeping Netflix ad-free.

With competitive pressure on the rise, deep-pocketed rivals such as Apple, Walt Disney and HBO have begun to chip away at Netflix’s dominance with their own streaming services. The easing of the pandemic is giving consumers entertainment options beyond binge-watching their favorite shows, and rising inflation is making them think twice about how many different streaming services they’re willing to pay for.

While the entire Internet was busy debating why Netflix witnessed a massive drop in its subscribers rate, Tesla boss Elon Musk had all the answers. The 50-year-old took to Twitter to reveal that the "woke mind virus" was making Netflix unwatchable.

"The woke mind virus is making Netflix unwatchable," Musk tweeted, but what does it mean? Woke is a slang used for people who are aware of and actively attentive to important facts and issues (especially issues of racial and social justice.)