I spoke at the Future TV Conference in Copenhagen, Denmark this week. It was great to get a Northern European/Scandinavian viewpoint on the evolution of our industry and I particularly enjoyed the conversations during the break. However, one conversation absolutely floored me.
A gentleman from Norway told me that he was an avid user of iTunes for video at home. The problem with this is that he uses the U.S. version of iTunes - from Norway. He is apparently not alone. I spoke to several people at the conference who were doing the same thing.
According to these people, it is relatively simple to gain access to U.S. iTunes content by following these steps:
1. Create a U.S.-based email account. You can do this easily with Gmail or Yahoo.
2. Use Google maps to find a US address - any address - which you can use to sign up for iTunes.
3. Friend someone on Facebook in the U.S. who will buy a U.S. iTunes gift card for you and send you the code. (Apparently there are several people willing to do this.)
Armed with these three items, you can sign up for a U.S. iTunes account and rent and stream U.S. content directly to your flat panel TV using an Apple TV box. Apple does not geo-block iTunes, as it relies on U.S. purchase credentials for sole control of where the content is viewed.
Geo-blocking is only marginally better at protecting the content. Many of the same people using iTunes in Norway have Netflix streaming accounts, as well. However, to receive that content they are using a VPN, which fools Netflix into thinking the video streaming request is coming from within the U.S.
There was even a discussion with a lawyer at the conference on the legality of doing the above. Although this discussion was in Danish - which unfortunately I do not speak - I was told afterwards the lawyer said it did not appear to be illegal. (Note: the lawyer was careful to avoid saying it was legal.)
Why are people doing this? Digital content services like Netflix and iTunes in the region are much more expensive (2-3 times more expensive than renting a movie in the U.S.). As well, the release windows are usually much earlier and selection much richer for U.S. iTunes content than on similar services in the region.
Now I do not believe the average Dane or Norwegian is watching U.S. iTunes and Netflix content (this was, after all, a "Future TV" conference, filled with gadget fanatics and innovators). And the good news is that folks doing this are paying for the content - just not the high-priced local rates.
Nonetheless, it certainly serves as warning to U.S. content providers that if they don't move aggressively into digital distribution in every region with fair pricing and reduced release windows they will have a tough time exercising any regional controls at all!
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