On January 14th, Netflix‘s Vice President of Content delivery pushed out a blog post outlining Netflix‘s stance on VPN use. In summation, the post described how Netflix does not support VPNs. If the last month is any indication, Netflix REALLY doesn’t support VPNs.
VPNs are virtual private tunnels that allow users to access Netflix without geo restrictions based on IP addresses. For example, you can pay for Netflix in the United States, but if you travel to China, you can’t access the same service you had before without a VPN. Or if you’re living in Australia, your library is significantly smaller than the United States Library. In a global world with global content access and its distribution, it’s an increasingly growing problem. On one hand, users in Australia feel it’s unfair to have a small library while entertainment industries in Australia feel Netflix is hurting their business. But remember, Netflix WANTS to be global. They want to be everywhere. So who is to blame?
Almost every single VPN provider is having issues with Netflix right now, with leading VPN providers fighting back by (TorGuard for example) creating new special Netflix servers, and other VPN providers just calling it quits. Many VPN providers are having difficulty since the IP blocks are much more aggressive than previously imagined. Many VPN users and non-VPN users alike are outraged at Netflix for messing with their paid service. One of our commenters explained how “I DON’T use a VPN and am getting this error. Netflix will not speak to my ISP about it, and my ISP is at a loss as to what to do. My $7.99 a month isn’t much, but Netflix is about to lose me as a customer.” Ouch.
While Netflix may be making television providers happy, things don’t look too well when the stock prices are concerned. As you can see from the graph, right around the date when the blocks started coming–Jan 15-21, is when the stocks began to drop.
But, 2015 has been a crazy year for Netflix, seeing HUGE jumps in the stock as it is. Even with this new low in the Netflix stock, around the same level as in May 2015, it’s still significantly higher than a year before in August of 2014.
Tons of new shows are booming on Netflix, with shows like Making a Murderer carving out a new space in the true-crime drama while shows like Jessica Jones push forward the Marvel brand that is starting to catch on fire. Not only that but Netflix itself claims to have made an enormous positive impact on the entertainment industry by halting torrent users from downloading illegal copyright protected content. You can see a direct effect on torrenting from the rise and popularity of Netflix here from search results:
As Netflix’s popularity has increased in search engines, the popularity of torrenting has gone down. In 2015, Netflix surpassed torrenting as a regional interest.
Netflix has had increasing success converting non-paying users into subscribed customers whether through unique content or sheer accessibility and convenience, but it remains to be seen if the very users Netflix has converted (VPN users are often Torrent users) will stay despite the blocks Netflix is pushing, or if they will just return to another alternative–that being illegal file sharing of movies and TV shows.
Netflix’s key secret to success is making media convenient. Starting out with DVDs in the mail, and now streaming–but their blockade against VPNS is directly hurting that positive ideal. Has Netflix gone too far this time? Or does it even matter? At the end of the year, data has shown that Netflix is still increasing while Bittorrent traffic is decreasing:
It’s too early to give a definitive answer yet on if Netflix has unwillingly pissed off the entertainment industry by pushing away converting paying customers into seeders. Once more stats come out on user traffic, we will have our definitive answer in part 2 of this blog post if Netflix has made a mistake–big or small. However, if stocks or angry people are any indications, I’m inclined to think “yes”, the block will increase torrenting significantly.
What do you think? Will you continue to use Netflix with a VPN like TorGuard? Or maybe, you just flip Netflix, the bird and be on your way to torrent heaven. If you’re interested in accessing Netflix with a VPN, check out this article.