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But you're forgetting that they're paying licensing fees for the third-party movies and shows. Let's take Warner Bros. as an example. They have this blockbuster film that Hulu bought the streaming rights to in US, but Netflix has it in Switzerland because there's no Hulu there. Now if you were Hulu and notice that you are losing a lot of potential customers because this film that's meant to draw people in, they are watching on Switzerland Netflix using VPN instead. You'd complain to Warner Bros. about it won't you? What's the point in paying millions for the rights to a film when people can just easily watch it on their rival service? In turn, Warner Bros. will have to give pressure to Netflix to keep stuff like this under control, and Netflix needs to keep on their good side in fear of Warner Bros. pulling their entire catalogue from their service. In that scenario, we as Netflix customers would come out poorer as well. It's not like Netflix wants to war with their own customers, but they only own the streaming rights for certain shows in certain markets so they need to respect that as well.
