Internet entertainment company Netflix has sent threatening letters to VPN provider TurboFlix. The entertainment giant claims that TurboFlix is infringing on its trademark in addition to violating the NetFlix terms of service.
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NetFlix is an internet company which allows people to watch movies and other entertainment content by buying a subscription. The service is very popular becomes it eliminates the need to go and buy content physically. In addition, NetFlix is quite affordable. The company has grown by leaps and bounds since its in inception. In fact, it was NetFlix which played a big role in the collapse of the movie rental giant Blockbuster.
The NetFlix model of doing business is as follows. NetFlix buys content from its original creators and owners then sells it to subscribers.The simple model has caused the business to grow to overseas, with major overseas markets including Canada and many European countries.
That said, NetFlix is limited in that it can only provide content which it has been licensed to. To make this clearer, one has to understand that entertainment content is licensed within geographical borders. The implication of this is that NetFlix can only sell content in countries where it has rights to show that content. To take an example, NetFlix can only offer American programs in America since it only has the rights for America. As it is, most of the content in NetFlix is American.
What this blockade has done is made a large part of NetFlix’s library inaccessible to users outside the US. This has resulted in users looking for ways to access the US content.
NetFlix blocks access to users outside the US by reading their IP address. If the company realizes that a user is logging in from outside the US, it blocks access to American content. This is called geo-blocking content.
Now, companies like TurboFlix help users access the US version of NetFlix by allowing them to hide their IP and make it look like they are logging in from the US.
By doing this, companies like TurboFlix are able to attract users to their VPN service for which they charge a small fee. They also are able to help users access other sites which are geo-blocked.
In the letter sent to TurboFlix,NetFlix raised several issues.One of the issues raised was that by using the suffix ‘flix’, TurboFlix was violating NetFlix’s trademark.The letter also accused TurboFlix of violating the NetFlix terms of service.
When contacted, the owner and founder of TurboFlix, Mike Curry declined to comment on the issue. He stated that he cannot comment on a matter that might be subject to legal proceedings.
While NetFlix has spoken about VPN users who trick its system with its security spokesman being quoted saying,”NetFlix simply uses industry standard methods to prevent illegal VPN use,” it is quite clear that they would rather not crack down on these users for two main reasons.
One of the reasons why it is because the VPN customers are still paying customers. The second reason is because it is quite hard to clamp down on these users.
Technology attorneys do not expect the threats to be followed up because this is a difficult case to take to trial. This is especially considering that TurboFlix is providing a VPN service, and not selling NetFlix’s content.
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