Netflix Enforces Streaming Restrictions for Users

Netflix is growing up fast and is already learning some painful lessons about operating in an increasingly competitive marketplace. For years, Netflix was the only game in town in terms of mail-order DVD rental and it was the first to truly succeed with streaming content directly to its subscribers. But now that the market is flooding with competition, the costs of doing business have increased dramatically for Netflix.

As a result, the company is being much more vigilant in limiting subscriber access to only the number of streams that are allowed under the terms of their account. Until recently, users could stream multiple movies simultaneously to different devices on the same account. But now the accounts are monitored so that only a single stream can occur at any given time, unless the account terms specifically allow for more.

Netflix is still the dominant force in the content rental and streaming space, but the barriers to its dominance are low and major sharks are now in the water. Amazon recently increased its subscriber library by over 100,000 titles and pricing is getting more competitive on a daily basis. To make matters worse, a once-sweetheart deal with Starz now appears to be falling apart for Netflix. The company announced that it will not renew its Netflix contract and that it will pull out all content by February of 2012.

All of this is happening against the back-drop of a major push for Netflix to expand abroad. The company is targeting a 2012 launch for Spain and has already made significant inroads in South America. But again, there are really no barriers for the competition to follow Netflix where ever it tries to expand. These are all relatively uncharted waters for Netflix, as the company was allowed to grow and thrive under the radar for many years, until it got so big and profitable that it was able to crush brick-and-mortar goliath Blockbuster before the old chain new what hit it. That most certainly isn't going to be the case moving forward. Major players are now well aware of the opportunities in streaming content and Netflix is now just a big fish in an expansive ocean. The next year or two will be especially telling for Netflix.