I think it's the same kind of math the studios use to estimate the damages from piracy: ignoring that people will simply give up when not presented with a reasonable alternative. How much money would a movie bring in if everyone who cared enough to watch it illegally for free had instead chosen to see it in theaters or buy the blu-ray? How many man-hours would be spent crunching this data if Netflix hadn't dumped it in a convenient format but everyone interested in the data was willing to process it the hard way?
