Netflix, Hulu and Cross-Border Copyright Infringement

This year, Netflix, the popular American multinational subscription video on demand (SVoD) internet streaming media service provider announced that it’s service has gone live globally. Kenya is among 130 countries that can now access internet streaming TV from Netflix. In Kenya, Netflix is now available via their official website: which means that for one monthly price Kenyan consumers can sign up to enjoy Netflix original series as well as its huge catalog of licensed TV shows and movies simultaneously with the rest of the world. As of October 2015, Netflix had 69.17 million subscribers globally, including more than 43 million in the United States of America.

Previously, for those who would want to enjoy shows on services like Netflix or Hulu, another leading online video service outside the US you were likely to receive the following notice:

We’re sorry, currently our video library can only be streamed within the United States. For more information on Hulu’s international availability, click here.

As result, many savvy Kenyans opted to purchase a US virtual private network (VPN) to by-pass Netflix or Hulu region locks so as to watch shows and movies that are supposed to only be available in the US. The question arises: is this copyright infringement?
From an intellectual property perspective, content on netflix and hulu are eligible for copyright protection both as audio-visual works and broadcasts. Take for instance, the Daily Show with Trevor Noah by Comedy Central (CC) currently available on Hulu. To host this show, Hulu is required to obtain a license from CC in order to make the Daily Show available on its website. Among the main rights granted to Hulu by CC are the making available right (a performing right), the communication to the public (a performing right) and the reproduction right (or mechanical right) in the Daily Show. In turn, Hulu is able to grant its users a non-exclusive limited license to use the Hulu Services, including accessing and viewing the Content on a streaming-only basis through the Video Player, for personal, non-commercial purposes.
The document which governs much of a Hulu user’s service use is the Hulu Terms of Use which begins with the following:
“Welcome to Hulu! It is our pleasure to provide the services described below for your personal enjoyment and entertainment in accordance with these Terms of Use (“Terms”). (…) Use of the Hulu Services (including access to the Content) is subject to compliance with these Terms and any end user license agreement that might accompany the applicable Hulu Service. Therefore, by visiting the Hulu Site or using any of the Hulu Services through any other Access Point, you are agreeing to these Terms.”
These Terms of Use cover a broad range of issues relating to the use of the Hulu service use including certain key clauses which have been reproduced below and highlighted in bold:
3.3 The Content. You may only access and view the Content personally and for a non-commercial purpose in compliance with these Terms. You may not either directly or through the use of any device, software, internet site, web-based service, or other means remove, alter, bypass, avoid, interfere with, or circumvent any copyright, trademark, or other proprietary notices marked on the Content or any digital rights management mechanism, device, or other content protection or access control measure associated with the Content including geo-filtering mechanisms.”
14.1 International Use. We are a company based in the United States. Hulu’s goal is to bring you as much Content as is legally available. That said, we are limited by the rights that our content licensors grant to us. Using technologies to access the Content from territories where Hulu does not have rights or does not offer services is prohibited. Hulu Plus is not accessible through any devices from outside the United States.”
Therefore, the purchase of a US virtual private network (VPN) to by-pass Hulu region locks to watch Hulu’s content is both an infringement of copyright as well as a material breach of Hulu’s Terms of Use, therefore it is illegal and punishable under civil and criminal law.
In the final analysis, the mere fact that there are Kenyans, South Africans and others willing to pay to indirectly consume US content is a challenge to existing pay TV service providers and other content providers on the continent to take all necessary steps to acquire licenses from US rights holders so as to grow their businesses.

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