Tennessee residents should avoid signing up for Splitfix, which is a new touted as a new way to save money by sharing Netflix and Hulu passwords amongst users – thereby “splitting” the cost.
In 2011, Tennessee legislators made it a crime to share passwords of online subscription services like Netflix and Hulu. As a result, the entire business model of Splitflix is a criminal model in Tennessee, which could possibly be subject to classification as a criminal enterprise under RICO statutes were such a business formed in Tennessee. It’s not, and there’s likely no way to for Tennessee to reach the activities of the business itself.
However, Splitfix.com customers who reside in Tennessee are almost certainly in violation of TCA 39-14-104, which criminalizes “Theft of services.” As noted above, in 2011, the Tennessee legislature amended the definition of services to include “entertainment subscription services” and thereby criminalized Netflix password sharing.
All that said, Splitflix.com is a dumb idea. Easily the dumbest start-up of the year.
Moreover, Splitflix just smells wrong – amiright? Even if it’s not a crime or if it doesn’t already violate the terms of service for Netflix and Hulu (which I think it probably does), it just seems a little evil to try to take advantage of another business by undercutting their customer base for your own profit. How about coming up with a better/alternative solution that’s actually competitive instead?
My prediction: Splitfix will die soon. Netflix and Hulu will make appropriate modifications to their Terms of Service and, if needed, will force Splitflix into submission.
