Wellington man says Netflix over-charged him $250 - and won't refund him

A Wellington man says Netflix has over-charged him around $250 since he joined in 2015. Photo / 123RF

"Fraser" - a Wellington white collar worker - says Netflix has over-charged him around $250 since he joined the streaming service in 2015 - and it won't refund him.

It's a bit of a convoluted tale (bear with us), and Fraser has more or less given up on any hope of compensation, but he wanted to share his story because he suspects a lot of other New Zealanders could be in the same situation.

It was only this month - four years down the track - that Fraser realised he was being billed US$14.99 (around NZ$22.22) a month for his Netflix plan, not NZ$14.99.

When he contacted Netflix' support, he was told he was charged in US dollars because he signed up using a US IP (internet protocol) address, which meant the streaming service automatically identified him as an American.

New Zealanders have often used VPN (virtual private network) software to access the US version of Netflix, which has a lot more content (something that was more keenly felt in 2015, a time before Netflix refocused its efforts on creating original content).

But Fraser told the Netflix help desk he had not been trying to masquerade as an American.

Instead, his ISP of the time, Flip, was one of several involved in a short-lived experiment to offer a "Global Mode" feature - which worked behind the scenes and allowed all customers to access Netflix US and other offshore services usually geo-blocked to New Zealanders.

Adam Sandler and Jennifer Aniston star in the Netflix movie Murder Mystery. Photo / Netflix

The idea was that VPNs were too technical for most users to install - or at least there was a popular perception they were - so it was better to have an ISP-wide, under-the-bonnet solution that worked for everyone.

In the event, Global Mode lasted only a few months. Sky TV, Lightbox-owner Spark, TVNZ and MediaWorks threatened legal action and Flip's parent company, CallPlus (which also owned Slingshot and Orcon) chose to settle before the matter reached the courts.

A complicating factor was that an Australian company called M2 had placed a bid for CallPlus shortly before Sky et al's legal threat. The deal eventually went through and M2, in turn, merged with Vocus. With that one-and-only case abandoned, there remains no precedent-setting case over whether VPNs - which some lawyers argue are merely the online equivalent of parallel importing are legal under the Copyright Act (1993).

With the act currently getting an overhaul, we may never know how a VPN arrangement would hold up in court under the current legislation.

We do know, however, that use of a VPN is against Netflix' terms and conditions.

But Fraser says he has only ever watched the NZ version of Netflix, from within NZ. He was not using a VPN to masquerade as a US citizen. Rather, he was an accidental American because of his ISP's set-up at the time he signed up.

One nuance is whether Fraser had to actively switch on Global Mode.

His memory is hazy on that point after four years.

"All I knew was that Netflix worked so I was happy," he says.

A Vocus spokesman clarifies, "Flip introduced Global Mode in February 2015. It was initially on by default until a toggle that allowed switching between regions was launched in March 2015, before Netflix NZ went live."

Fraser forwarded the Herald a recording of a call with Netflix support, during which a help desk rep confirms Fraser is only able to access NZ content.

The Wellington man's beef is: how could Netflix's delivery system be smart enough to recognise that he was in NZ and block US content, but so wilfully dumb that it charged him in US dollars even though he was in NZ and paying with an NZ credit card.

Netflix show Grace And Frankie. Photo / Netflix

Fraser spoke or live-chatted with three different Netflix help desk reps.

One argued the toss, positing that Fraser could have been a US customer on a long, long holiday to NZ, offering: "people do travel for years".

The other two were broadly sympathetic but said they were just unable to offer a refund. The only solution the help desk jockeys were able to offer was for Fraser to cancel his account, then sign up again from a mobile phone to ensure he was on a New Zealand account (Netflix prefers people to sign up from a smartphone because VPNs, in the main, are not installed on mobiles).

In the meantime, Fraser says he doesn't want to leave Netflix. He would be happy with a credit rather than cash, if that would help smooth things over. But, so far, he's had no joy.

Netflix declined the opportunity to comment or provide answers to questions forwarded by the Herald.