Quickflix Australia complains to Netflix

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freitasm

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Topic # 152089 15-Sep-2014 20:25

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What does a company that can't/won't fight for consumers' rights do when cornered by marketplace forces?

Complain about those parallel importers of course: Quickflix boss tells Netflix to end ‘back door’ access for Aussies.

The CEO of streaming company Quickflix Stephen Langsford has written an open letter to his Netflix counterpart Reed Hastings challenging the company to “come through the front door” to the Australian market and cut off access for an estimated 200,000 local subscribers.

In the open letter, sent today by Langsford, he accuses Netflix of encouraging “Australian consumers to inadvertently breach the copyright of the content owners”, and accuses them of “filching” revenues by allowing users with geo-blockers from Australia to access its content.

The important bit here, that may explain a lot:

"Shares in Quickflix are currently trading at 10c, giving it a market capitalisation of $15.23m."

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Reply # 1129420 15-Sep-2014 20:54

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We need to protect our business model! Better accuse people of copyright violations!

Gordy7

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Reply # 1129461 15-Sep-2014 21:27

10C per share?

Gordy

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Reply # 1129463 15-Sep-2014 21:29

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Reply # 1129465 15-Sep-2014 21:31

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This kind of statement really annoys me.

he accuses Netflix of encouraging “Australian consumers to inadvertently breach the copyright of the content owners”, and accuses them of “filching” revenues by allowing users with geo-blockers from Australia to access its content.

Using Netflix is no different to ordering a DVD, CD, Blu-ray from the USA for a fraction of the price charged locally. It's not illegal, copyright is not breached, people are getting paid for the work they did but it is of course embarrassing the local providers. If Netflix started setting up servers in AU or NZ then that can be argued as unfair against the local distributors.

What next, the cable/satellite company are too cheap for them to do business so everybody has to pay more?

Lightbox are getting it right particularly if you are a Spark consumer.

Procrastination eventually pays off.

old3eyes

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Reply # 1129652 16-Sep-2014 09:22

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Quickflix where almost every thing on their TiVo service is in SD..

Regards,

Old3eyes

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Reply # 1130161 16-Sep-2014 18:33

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Stephen Langsford comes across as a bit of a cretin.

There is no piracy involved, just parallel importing. Subscribers are still paying and Netflix is paying content providers for the material it sources.

What's next - Whitcoulls writing an open letter to Amazon accusing them of "encouraging NZ consumers to inadvertently breach the copyright of the content owners and filch revenue, by allowing customers to buy books from someone other than the publisher's NZ distributor"?

He has a poor quality product (range, picture quality, devices it will work on) that's overpriced. Maybe he should focus on that as the reason he's being out-competed?

blakamin

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Reply # 1130165 16-Sep-2014 18:43

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Even if they did manage to stop Netflix here, there's no way in hell I'd use the complete load of dogs vomit that is Quickflix.

sen8or

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Reply # 1130170 16-Sep-2014 19:04

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Let's have a look at some "facts ".

By his own admission, quickflix reckons Aussie has 200k Netflix subscribers, that's with no marketing whatsoever in "their market". Quickflix has about 170k members with millions spent on marketing in their local market and quickflix is challenging Netflix? Ballsy, stupid but ballsy.

They have got the wrong attitude/approach. Rather than whinge like a schoolgirl about how unfair it is, they should be using that as ammo against the content holders to get faster and cheaper access to content so that consumers don't have to circumvent things.

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Reply # 1130172 16-Sep-2014 19:08

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Telecom should have purchased quickflix back when they announced their TV plans, if it is only valued at 15 million. Would have then given them access to heaps of devices., including tivo and some tvs, like sony ones which have quickflix built in.

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Reply # 1130206 16-Sep-2014 19:58

JimmyH: Stephen Langsford comes across as a bit of a cretin.

There is no piracy involved, just parallel importing. Subscribers are still paying and Netflix is paying content providers for the material it sources.

What's next - Whitcoulls writing an open letter to Amazon accusing them of "encouraging NZ consumers to inadvertently breach the copyright of the content owners and filch revenue, by allowing customers to buy books from someone other than the publisher's NZ distributor"?

He has a poor quality product (range, picture quality, devices it will work on) that's overpriced. Maybe he should focus on that as the reason he's being out-competed?

Not for the NZ rights, which is his point.
Netflix is 'competing' in the Oz market, (and NZ) without incurring any of the costs necessary.
They don't pay Oz tax (like GST) they don't pay for Oz rights, they don't have to abide by any australian consumer guarantee laws - which are much more substantial than required in the USA for the most part.
It's not quite comparable to parallel importing, since at least with parallel importing of, say, DVDs, the seller still has to incur the cost of buying the product from it's source. With Netflix, they are not incurring the costs of the OZ content at all. but are getting a 'free ride' because they have bought US rights. It's a lot closer to copyright violation than you think - but it's actually netflix doing the violation, not the end customer.

So I get where he is coming from - it must be very frustrating having this happen to you, but I don't think his letter is going to make much difference. It will require foxtel or someone big to make a stink.

blakamin

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Reply # 1130210 16-Sep-2014 20:04

Foxtel have tried.... and failed, numerous times.

So much so that as of Nov 3 foxtel are dropping their prices and adding more channels to the basic package. Which is still 4 times as much as Netflix.

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Reply # 1130384 17-Sep-2014 06:42

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NonprayingMantis:
JimmyH: Stephen Langsford comes across as a bit of a cretin.

There is no piracy involved, just parallel importing. Subscribers are still paying and Netflix is paying content providers for the material it sources.

What's next - Whitcoulls writing an open letter to Amazon accusing them of "encouraging NZ consumers to inadvertently breach the copyright of the content owners and filch revenue, by allowing customers to buy books from someone other than the publisher's NZ distributor"?

He has a poor quality product (range, picture quality, devices it will work on) that's overpriced. Maybe he should focus on that as the reason he's being out-competed?

Not for the NZ rights, which is his point.
Netflix is 'competing' in the Oz market, (and NZ) without incurring any of the costs necessary.
They don't pay Oz tax (like GST) they don't pay for Oz rights, they don't have to abide by any australian consumer guarantee laws - which are much more substantial than required in the USA for the most part.
It's not quite comparable to parallel importing, since at least with parallel importing of, say, DVDs, the seller still has to incur the cost of buying the product from it's source. With Netflix, they are not incurring the costs of the OZ content at all. but are getting a 'free ride' because they have bought US rights. It's a lot closer to copyright violation than you think - but it's actually netflix doing the violation, not the end customer.

So I get where he is coming from - it must be very frustrating having this happen to you, but I don't think his letter is going to make much difference. It will require foxtel or someone big to make a stink.

I disagree, this is exactly the same as parallel importing. Neither Amazon or Netflix pay local taxes or worry about consumer laws. Both companies buy their products from their local US distibutor/supplier. If I buy from Amazon I gave to pay the delivery, for me to access Netflix I have to pay for delivery with a DNS/VPN.

Is it frustrating for the local distributors? yes. Is it a fault of Netflix? no not in my opinion. The companies that they should be going to are the distributors to get better access at a rate suitable for the market without all the stupid restrictions (5 devices, 1 swap per month etc etc).

This is no different to the NZ shops complaining that we should be charging GST on all imports regardless of their value - it misses the point which is that we all live in an international market, and that's what companies need to compete against.

Making everybody pay more just to level the playing field will not work, and this is what the Quickflix argument is based upon. Quickflix need to employ better negotiators.

Procrastination eventually pays off.

MikeB4

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Reply # 1130394 17-Sep-2014 07:23

Quickflix should test their claims in court, it would be interesting to see the outcome.

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Reply # 1130464 17-Sep-2014 09:41

StarBlazer:
NonprayingMantis:
JimmyH: Stephen Langsford comes across as a bit of a cretin.

There is no piracy involved, just parallel importing. Subscribers are still paying and Netflix is paying content providers for the material it sources.

What's next - Whitcoulls writing an open letter to Amazon accusing them of "encouraging NZ consumers to inadvertently breach the copyright of the content owners and filch revenue, by allowing customers to buy books from someone other than the publisher's NZ distributor"?

He has a poor quality product (range, picture quality, devices it will work on) that's overpriced. Maybe he should focus on that as the reason he's being out-competed?

Not for the NZ rights, which is his point.
Netflix is 'competing' in the Oz market, (and NZ) without incurring any of the costs necessary.
They don't pay Oz tax (like GST) they don't pay for Oz rights, they don't have to abide by any australian consumer guarantee laws - which are much more substantial than required in the USA for the most part.
It's not quite comparable to parallel importing, since at least with parallel importing of, say, DVDs, the seller still has to incur the cost of buying the product from it's source. With Netflix, they are not incurring the costs of the OZ content at all. but are getting a 'free ride' because they have bought US rights. It's a lot closer to copyright violation than you think - but it's actually netflix doing the violation, not the end customer.

So I get where he is coming from - it must be very frustrating having this happen to you, but I don't think his letter is going to make much difference. It will require foxtel or someone big to make a stink.

I disagree, this is exactly the same as parallel importing. Neither Amazon or Netflix pay local taxes or worry about consumer laws. Both companies buy their products from their local US distibutor/supplier. If I buy from Amazon I gave to pay the delivery, for me to access Netflix I have to pay for delivery with a DNS/VPN.

see my post, as well as the original open letter.

Netflix does not pay for the content it sells to NZers (and Ozzie). It pays for content it sells to Americans.

A more analagous situation regarding Amazon, would be if this happened:

1) NZer orders DVD from Amazon
2) Amazon grabs a DVD they purchased from, say, Sony Pictures that they might otherwise sell to an American.
3) Instead of sending out the DVD to the NZer, they just make a copy of it and send the copy without telling Sony Pictures or paying them any royalties
4) Next time a NZer orders a DVD, amazon make another copy, incur basically no cost, and ship that copy again.
5) They continue to do this, selling copies of DVDs to NZers at reduced prices, because they aren't incurring the major costs of actually providing the DVD (i.e. buying them in the first place)

If that sort of thing was happening, then rightly mightyape.co.nz would get pretty peeved that they incur the costs to the suppliers by providing 'genuine DVDs', where Amazon is getting away with incurring no costs by providing copies they have no right to sell.

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Reply # 1130475 17-Sep-2014 10:09

NonprayingMantis:
StarBlazer:
NonprayingMantis:
JimmyH: Stephen Langsford comes across as a bit of a cretin.

There is no piracy involved, just parallel importing. Subscribers are still paying and Netflix is paying content providers for the material it sources.
...

see my post, as well as the original open letter.

Netflix does not pay for the content it sells to NZers (and Ozzie). It pays for content it sells to Americans.

A more analagous situation regarding Amazon, would be if this happened:

1) NZer orders DVD from Amazon
2) Amazon grabs a DVD they purchased from, say, Sony Pictures that they might otherwise sell to an American.
3) Instead of sending out the DVD to the NZer, they just make a copy of it and send the copy without telling Sony Pictures or paying them any royalties
4) Next time a NZer orders a DVD, amazon make another copy, incur basically no cost, and ship that copy again.
5) They continue to do this, selling copies of DVDs to NZers at reduced prices, because they aren't incurring the major costs of actually providing the DVD (i.e. buying them in the first place)

If that sort of thing was happening, then rightly mightyape.co.nz would get pretty peeved that they incur the costs to the suppliers by providing 'genuine DVDs', where Amazon is getting away with incurring no costs by providing copies they have no right to sell.

Correct me if I'm wrong NPM, but it seems that your logic has a flaw:

When a Netflix US customer in NZ uses UnoTelly to watch a programme that they have purchased as part of their monthly sub, surely Netflix US have to pay the content provider a royalty?
To Netflix, it appears as though a US customer viewed the programme, so a royalty is payable

Or am I missing something here?

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