Court says online streaming falls under Video Privacy Protection Act

A Northern California court has ruled that the Video Privacy Protection Act (VPPA), a 1998 law enacted during the era of movie rental stores, applies to online video service providers as the modern-day extensions of those old brick-and-mortar structures. Boiled down to its essence, the law prohibits a "video tape service provider" from disclosing information about what its customers purchased or rented. That prohibition also extends to online video streaming, the court said.

The decision by Northern District Court Judge Laurel Beeler clears the way for a VPPA claim to proceed against Hulu for allegedly disclosing "video viewing information to third parties that provided services on its website," a story in Inside Privacy explained.

Hulu, which is owned by News Corp. (Nasdaq: NWSA), Comcast's (Nasdaq: CMCSA) NBCUniversal, Providence Equity Partners and Walt Disney Co. (NYSE: DIS) had claimed that VPPA was not relevant because it covered only information about consumers who obtained physical objects from physical stores. Beeler shot that down, saying that the statute covers "video content, not ... how that content is delivered."

Hulu also argued that the plaintiffs in the case did not meet the definition of "consumers" as set out by VPPA as a "renter, purchaser or subscriber or goods or services from a video tape service provider." According to Hulu, the plaintiffs had not paid for the service. Beeler's response was that they were still subscribers because they "had registered for Hulu accounts, received Hulu IDs, established Hulu profiles and used Hulu's services."

Importantly, the judge did not rule on the merits of the case. The plaintiffs argue that Hulu allowed KISSmetrics, an analytics company, to place a cookie on their computers that tracked names, location preferences and programs watched and that the information was given to other companies, including Facebook.

Hulu has since discontinued using KISSmetrics, a New York Times story said, adding that Hulu declined to say whether or how it "continued to share video consumption records with third parties for advertising or other purposes."

While Hulu is in the spotlight thanks to the legal action, other streaming video services are watching intently. Netflix (Nasdaq: NFLX), for instance, wants to create a similar link between its video service and Facebook.

Both Netflix and Hulu are said to be lobbying to overturn the law.

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