Netflix, Inc. (NASDAQ:NFLX) has been high-flier in the S&P 500 index in the year-to-date. The firm has blessed Wall Street with massive gains, its user base is growing, and it is spending money to license top movies and to produce its own movies. Yet, the firm might be heading into troubled waters in 2016 as double trouble attempts to erode its income stream and push users away from the platform.
News has it that Netflix now has to contend with pirates who are flooding torrent sites with leaked ultra-HD (4K) videos from the firm. More so, hackers seem to have found a way to enter Netflix systems as they now offer lifetime access to stolen Netflix accounts for less than $1. Both attacks are serious worries that could cripple Netflix’s core business if left unchecked.
Netflix is a target for pirates and hackers
News says that pirates had finally cracked the 4K copy protection on Netflix titles and some of its movies are now open for download on torrent sites. The streaming space thinks that High-Bandwidth Digital Copy Protection (HDCP) is strong but pirates broke the system to leak “Breaking Bad” in August. TorrentFreak notes “many groups started releasing 4K rips and they are working. I expect that 4K releases will become more popular now”.
Netflix, Inc. (NASDAQ:NFLX) needs to find a way to stop pirates from ripping its titles – the ripping of 4K streaming titles might lead to a serious loss of income for the firm. Many Netflix users will keep their accounts active even though ripped versions of the movies are on torrent sites. However, some folks who watch the rare Netflix movie might be tempted to close their accounts if they can get the movies on torrent sites.
Hackers have Netflix in the crosshairs
As Netflix, Inc. (NASDAQ:NFLX) battles pirates for movie rips, the firm also needs to battle hackers who have taken over some Netflix accounts. A report by McAfee Labs revealed that you could buy access to many online streaming services such as Netflix, HBO and Spotify on the Dark Web. If you want to access the Dark Web, you’ll need a TOR browser – visit the Dark Web at your risk. You can get lifetime access to a Netflix account for as low as $0.50 and the sellers often provide a guarantee that the access account is active.
It appears that the owner of the accounts don’t usually know that their accounts have been stolen and it is quite possible that they accounts were created with stolen credit cards. Either way, Netflix could find itself in the center of a serious backlash when users start to demand tighter data security even when the fault can’t be tied to Netflix. More so, some users could close their Netflix accounts for the fear of hackers.