Netflix To Crack Down On Proxy Servers As Share Price Continues To Be Volatile


Netflix is cracking down on people using proxy servers to access the SVOD giant’s library. The use of VPNs (virtual private networks) was commonplace in territories that didn’t have an official Netflix service, such as the Middle East, or even in places like Australia where Netflix was available but with a limited library. VPNs allow users to spoof their location and get access to Netflix’s U.S. service. In the wake of the “Netflix Everywhere” drive, announced Jan. 6 by Netflix chief Reed Hastings that Netflix had expanded into 130 countries, including Russia, India and the Middle East, Netflix execs are cracking down on the practise.

The question of geoblocking content- i.e. restricting content licenses via territory as in film and TV sales- is becoming a major issue worldwide. The European Union continues to find way to create a single digital market, much to the chagrin of content producers who argue the end of the territorial license fee based system of monetising a piece of IP could lead to the end of the film and TV business.

“Given the historic practice of licensing content by geographic territories, the TV shows and movies we offer differ, to varying degrees, by territory,” said David Fullagar, Netflix’ vp of content delivery architecture, in the company’s blog. “We will continue to respect and enforce content licensing by geographic location. Some members use proxies or “unblockers” to access titles available outside their territory. To address this, we employ the same or similar measures other firms do. This technology continues to evolve and we are evolving with it. That means in coming weeks, those using proxies and unblockers will only be able to access the service in the country where they currently are. ”

The move will likely hasten the pace of Netflix’s attempts to offer worldwide cleared content across all its territories.  That is certainly far easier to do with its original content, which it has fully financed, and can now amortise across its 190 countries. Acquisitions, however, particular for TV series with a U.S. broadcaster will be harder to square on a global basis, hence the need to enforce stricter rules on the use of proxies.

?We are making progress in licensing content across the world and, as of last week, now offer the Netflix service in 190 countries, but we have a ways to go before we can offer people the same films and TV series everywhere,” wrote Fullagar.

Netflix’s share price has been particularly volatile this year, starting 2016 by dropping to $107.66 on Jan. 5, before jumping to $117.68 on news of Netflix’s international expansion on Jan. 6, before dropping again this week to $107.06 as of this morning amid concerns over slowing U.S. subscribers and some uncertainty over the success of the international growth.


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