Netflix, it appears, wants to take its content archives global. But the problem is, a lot of the content that Netflix provides access to is actually provided under licenses which put geographical restrictions on the places where the content can be provided. So Netflix has argued, and kudos to them for this, that their move to go global is aimed at countering piracy.
This is not an empty claim. There is an increasingly popular line of thought which argues that one of the most major reasons for the piracy of content is the lack of its availability. As I had argued in my earlier post, a lot people pirate content not because they are unwilling to pay for it, but because they have no other alternative if they want to access the content in question. This conundrum actually manifests very interestingly in the context of Netflix – since so much of Netflix’s content is geographically restricted, a lot of its users take to using Virtual Private Networks (‘VPNs’) in order to fool their internet connection to show that they are actually in the US. Thus, despite the fact that these users are legitimate, paying subscribers of Netflix, to get the content they want, they still have to bend the rules. These are users willing to pay for the content, but they just can’t quite manage to, because there are no services that allow them to.
And in fact, Netflix itself plays to this phenomenon – a major appeal of Netflix is the ease-of-access it provides for content, as compared to older models of content-sharing. And due to exactly this, the very existence of Netflix has a documented effect in countering piracy. Netflix aims itself at the sectors that older models of content distribution do not deal with.
Thus, Netflix wants to take its model global, and the very convincing argument it’s using for this is that it will decrease piracy across the board. As Reed Hastings, the CEO of Netflix, stated:
“The key thing about piracy is that some fraction of it is because [users] couldn’t get the content. That part we can fix. Some part of piracy however is because they just don’t want to pay. That’s a harder part. As an industry, we need to fix global content,”
At the same time, it must be noted here that providers who have tried the pay-for-content model in India haven’t always hit off very well – case in point, Flipkart’s online music store Flyte, which was shut down only a year after it started off. But Netflix has a far more reliable business model, and has a strong reputation to build on, making it likely that it’ll provide for a culture for paying for easy access to content in India. Still, whether Netflix Global will succeed in India or not remains to be seen. Even if it does not, it will provide lessons for the innovators that follow.
Whatever Netflix’s intentions here are, it is undeniably a positive step that would bring easy access to a plethora of content to people across the world. It also brings in Netflix’s internet-age business model to a broader audience, which is arguably excellent news for innovation. The biggest roadblocks here, though, are the licensors of content. It is as of yet unclear if these licensors will be willing to give Netflix the ‘global’ license it would need to provide such a service, though there are very few arguments as to why they wouldn’t – this way, they arguably do not lose much money, and at the same time tap into the revenue which is currently being eaten up by pirates. But as I’ve argued earlier, the industry seems to be rather slow in shifting from its older distribution models to the models of the internet-age. How this plays out can only be seen with the passage of time. But if Netflix’s entire archives, or perhaps even half, come to India, I’m definitely signing up.