VPN Services Successfully Blocked, Means Access to Much Less U.S. Content Than Before. And Price Hikes Are on the Way Too.
This was a bad week for Canadian Netflix users. Netflix started carrying out their threat to start cutting off users who were using VPN or proxy services to access, primarily, the U.S. version of Netflix with it’s larger share of programming. As of this week, the threat of losing access to U.S. Netflix became much more real as subscribers using VPN (Virtual Private Networks) services saw an unwelcome message: “Whoops something went wrong…you seem to be using an un-blocker or proxy. Please turn of any of these services and try again” with a link to how to disable proxies. This had been known since January, but it was not expected to be be as successful as it seems to have been.
The reaction was swift online, with Twitter filled with threats to return to BitTorrent, a file transfer technology invented in 2001 that was widely known among students due to its ability to transfer large files efficiently over slower broadband networks. Originally designed for distributing large free operating systems like Linux, BitTorrent enjoyed massive success over the next few years as people used it to download movies, even if it required some technical know-how to find movies and wade though the bad copies. Companies like Netflix, like iTunes before it, provided a simple, legal and affordable way for people to get access to content.
But the technical attack on proxies was only part of the story. The other part was financial: companies providing the VPN services depend on subscribers paying for that service so they can keep the lights on. Much like when credit card companies can choose to cut service for businesses they don’t approve of, VPN companies that advertised their services for getting around country restrictions where finding that they could no longer accept payments from their customers. PayPal also cut of support, essentially forcing them to change their business model or go out of business.
To add insult to injury, Netflix also raised their base prices this year by about $2 (US), including for customers who had been grandfathered in and spared last year’s raise.
Of course, in Canada, Bell and Rogers, owners of similar streaming services CraveTV and Shomi, might pick up some subscribers who make good on their threat to cancel their Netflix accounts.
This isn’t the end of the story by any stretch. The VPN companies are probably working on ways, both technical and legally to work around this issue. Payments could be made by a currency like BitCoin (but dispite the attention it’s got in recent years, it’s still technically daunting compared to the ease of PayPal). On the other side, Netflix wants to get to the point where content can be licensed globally. Already they, other services like Amazon Video are creating their own content that doesn’t hold them hostage.