#Asia IMO: On Netflix’s decision to crackdown on VPNs

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Netflix recently announced its plans to stop users from accessing its services via a proxy. These five individuals share what they think about it

IN MY OPINION
IMO, which stands for ‘In My Opinion’, is a new content series by e27 to allow readers to voice what they think about certain trending topics. Here, we talk to five individuals about their views on whether US-based entertainment startup Netflix should crack down on users accessing its content via virtual proxy networks (VPNs) and the effect this decision will have on its business.

Background: Netflix recently made headlines when it started offering users in 130 countries the ability to use its services. For the unfamiliar, users can watch as many television programmes and movies as they like on Netflix by paying a monthly fee.

However, Netflix also came out to say that it’ll be cracking down on VPNs, which users use to unlock content only available in another market. For example, a lot of US-based users were using VPNs to access their Netflix accounts, packed with content approved for the US market, when they were overseas. This allowed users to watch shows that may not be available in another market, like South Korea, for instance.

Should Netflix crack down on VPNs and proxies?

Ken Ming Lee, CEO, Peas In A Pod (Cornflix)

The most likely reason Netflix is cracking down on VPNs is probably due to pressure from the rights owners.

Content they’ve licensed for the US market is solely for the US market, but many ‘VPN pirates’ bypass the geo-blocks via proxies to access the US version as they have the best and widest selection of content.

From a pure revenue perspective, Netflix has probably no incentive to block VPN users as it risks losing substantial numbers of subscribers logging in from around the world. But if it doesn’t, it would probably be breaching its licensing terms.

Michael Smith Jr., CTO, HOOQ

Yes, it should, since this is how the OTT (over the top) market works, and Netflix has been getting away with it due to it not being a global service. Now that it is playing a global business game, it will have to follow the rules like everyone else.

Anisa Menur A. Maulani, Correspondent, e27

I can understand Netflix’s decision at some level, but there is one thing that it needs to keep in mind: Users are getting smarter.

Even after Netflix is officially launched in 130 countries, users are aware that not all content is available in their country, and they know exactly what they want to see.

Also Read: Viu to offer Singaporeans head start on Korean dramas and variety shows

While it is understood that the content restriction is often imposed by content owners themselves, I think this serves as a challenge for Netflix to be able go the extra mile to serve its users well. Asian users, in particular, are not naive; they’re not just going to accept whatever shows that Netflix is giving to them. They know exactly what they want to see and they will keep on trying to do that.

Phatthaworn Phongphaew, Chief Product Officer, PrimeTime

This is not a new policy enforced by Netflix. It remains the same as it ever was. Terms of services from any streaming provider, including PrimeTime, state clearly that users are not allowed to virtually cross borders due to content licensing agreements with studios.

Kim Le, Spokesperson, Gom VPN

Netflix offers each subscription at around US$8 worldwide, but the content offered to non-US regions is significantly limited. Using VPNs is a way Netflix subscribers can get the most out of their money.

With Netflix actively cracking down on proxies and VPNs, subscribers no longer feel they are getting their subscription worth. Remember, the first month free trial is still active since Netflix’s global launch on January 7, so Netflix users can still cancel at no cost. There are plenty of other ways to watch movies and shows besides Netflix.

How well do you think this enforcement will be carried out?

Ken Ming Lee

Netflix has been talking about cracking down on VPNs for a long time. It’ll be interesting to see how widespread and effective this enforcement will be.

Michael Smith Jr.

I think it will come over time and will depend on how much they are pushed — there are many ways to deal with it.

Anisa Menur A. Maulani

How can Netflix prevent users from ‘cheating’ by using VPN? I don’t think there is really a way to prevent it. It may try to crack down the use of VPN, but people will always find new ways to access content. As long as the company is not able to fulfill the needs and demands of customers, it’ll continue to face such setback.

Also Read: Malaysians view mobile videos primarily at home: Survey

If anything, the effort should actually come from content owners themselves — to actually understand what the audience want, and the consequences of not being able to provide the same.

Phatthaworn Phongphaew

I believe everyone in the industry is aware of this barrier which may be taken down eventually in the future — local content can be reached by users globally and vice versa.

The challenge is for licensing policies of studios — how they can be restructured to balance the ecosystem where third party representatives or distributors are still important partners in amplifying and driving revenue in other regions.

Kim Le

We have no clue how exactly Netflix will carry this out; probably by detection of the traditional VPN protocol. We think the enforcement is only temporary to appease the studios and networks that Netflix will protect its content and abide by licensing deals.

What do you think will be the effect of Netflix stopping users from accessing region-specific content via a proxy?

Ken Ming Lee

I think many will continue to subscribe to the local versions, but the question is how long will they stay subscribed. Early sentiment seems to be that the Singapore version of Netflix is slightly thin. If regulators zero in on Netflix, that could also mean that many of their original productions would be affected… reducing the pool of content available for viewers to binge on.

Michael Smith Jr.

Sure, users will hate this and wrongly point the finger at Netflix but this issue is not its idea; it’s just the way content rights work and the hope is that someday that there will be a better model for OTT content rights.

Since Netflix is a public company, it needs to show where its subscribers really are, and that users have signed up for local catalogs. It should not be counting users via the arbitrage game.

However, this is the way the world works. Netflix might get a lot of complaints, but it can’t deny the legal reasons for enforcing it.

The post IMO: On Netflix’s decision to crackdown on VPNs appeared first on e27.

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