Sometime before now and the fall, Netflix will launch their Facebook integration offering, likely a low friction way to like, comment on and share movies with friends. Netflix has been working on this for a while, and with founder Reed Hastings' recent addition to Facebook's board, some believe this is just the beginning of a broader shift to make Netflix a more social, web-based company. Don't get too excited, though. The Facebook integration will only be available in Canada and Latin America at launch time due to an old privacy law in the United States. Netflix explained in their quarterly earnings report:
At this point, we plan to launch [Facebook integration] only in Canada and Latin America, as the VPPA (Video Privacy Protection Act) discourages us from launching our Facebook integration domestically. Under the VPPA, it is ambiguous when and how a user can give permission for his or her video viewing data to be shared. A bipartisan group of lawmakers has introduced a simple clarification, HR2471, which says when and how a user can give such permission. We’re hoping HR2471passes, enabling us to offer our Facebook integration to our U.S. subscribers who desire it.
Indeed, the VPAA is pretty vague about how disclosing video rental information should be handled. The law dates back to 1988 and the Senate's confirmation hearings for Robert Bork's nomination to the Supreme Court. During the debate, the Washington City Paper reported on Bork's video rental history--an "utterly, utterly unremarkable" document according to one blogger. Congress lashed back at what they viewed as an invasion of privacy and passed the VPAA to regulate video rental history records. (The legislation is now popularly known as "the Bork Law.") The exact wording of the law that would likely concern Netflix says that rental history can be disclosed "to any person with the informed, written consent of the consumer given at the time the disclosure is sought."
The law Netflix needs to move forward with the deal, HR2471, is currently waiting to come before the House Judiciary Committee. Bob Goodlatte, the bill's sponsor and chair of the newly reconstituted subcommittee on Intellectual Property, Competition and the Internet, is widely seen as a good friend to internet companies. Goodlatte, who is up for reelection next year, made headlines recently for opposing the FCC's net neutrality laws and argued that Congress--presumably his committee--should control the regulation of the telecommunications industry. At that time, the congressman's hometown newspaper pointed out that the industry Goodlatte wants to regulate also happens to be that which gives him the majority of his compaign donations. In 2009 and 2010, a combination of internet, television, movies and music indutry donated over $110,000 to Goodlatte's reelection campaign. His top 20 donors include companies like Google, Yahoo, Comcast, eBay and Microsoft.
As Hulu and YouTube already have Facebook integration, it seems apparent that the new law will benefit Netflix more than competitors. The update to the Bork Law seems harmless enough and before Netflix's press release hadn't gotten that much scrutiny. But with the internet rapidly becoming a big topic of conversation on Capitol Hill, Goodlatte might be a member to watch.