August 14, 2012, 6:24 pm

Hulu Faces Privacy Test in Court
By SOMINI SENGUPTA
NY Times

http://bits.blogs.nytimes.com/2012/08/14/hulu-faces-privacy-test-in-court/?pagewanted=print


Can a privacy law passed in the era of videotape rentals be applied in 
the era of Internet streaming?

Hulu, the online video content provider, is about to face the test. A 
lawsuit filed in a federal court in California says Hulu violated its 
users' privacy by sharing their viewing history with companies that 
could in turn offer them tailored advertisements.

The case rests on a 1988 law, the Video Privacy Protection Act, intended 
to protect the privacy of video rental records. It was passed by 
Congress after a newspaper obtained records of what movies the 
conservative Supreme Court nominee Robert Bork had rented, and published 
an article based on them.

Hulu, which is owned by News Corporation, NBCUniversal, Providence 
Equity Partners and the Walt Disney Company, sought to have the case 
dismissed, noting that it is not a video rental business.

Magistrate Judge Laurel Beeler concluded Friday that the law did not 
preclude application to "new technologies for prerecorded video content" 
and allowed the case to go ahead. Next comes the discovery of evidence 
and arguments. The judge has not yet ruled on the merits of the case.

The plaintiffs will seek to prove in court that Hulu violated their 
privacy by letting third-party companies track their movements across 
the Internet without their consent. To do so, Hulu allowed an analytics 
company, KISSmetrics, to place a "cookie" or code on their computers 
that included names, location preferences and programs watched. That 
information was in turn conveyed to other companies, from advertising 
networks to analytics companies to Facebook. "As to Facebook, Hulu 
included their Facebook IDs, connecting the video content information to 
Facebook's personally identifiable user registration information," the 
judge wrote.

Hulu has since discontinued using KISSmetrics, after two separate 
academic studies reported on the practice last year.

Hulu declined to comment on whether or how it continued to share video 
consumption records with third parties for advertising or other purposes.

The case could have repercussions for other video streaming services. 
For instance, Netflix, which allows users to stream movies online, wants 
to team up with Facebook to allow its users to share what movies they 
watch with their Facebook friends. Both companies have acknowledged that 
the Video Privacy Protection Act presents a hurdle. Both are lobbying to 
overturn the law.

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