ability to give case-by-case permission to a video company on what it can tell people and what it can't. and that worries me because case-by-case consent, i believe is a really good thing. it's a really good thing that people can easily tell their video company, sure go ahead and tell people i watched "the godfather," but, no, don't tell them i watched "yoga for health," depression and gastrointestinal problems. for the record, that is a real title in the netflix catalog. by the way, it's an excellent film. so i'm worried that hr-2471 will eliminate our ability to give case-by-case consent. but i'm also worried that this bill will make these changes without confirming that streaming is covered or doing anything else to strengthen the law for consumers. finally, i want to know how this

bill will affect the video privacy protections acts, protections against government snooping into our video records. but i'm here to listen and to learn more about this. and this is a hearing on all proposals to update the video privacy protection act, not just hr-2471. and we have two great panels for that. but before i introduce them -- you want me to go to the chairman first? >> i tell you what. we have senator coburn here. >> i'm happy to yield to the chairman. >> no, i'll yield to you and also congressman watt has been such a leader in this. he has to get back to matters in the house. so i'll wait until he's testified. of course, i'll follow the rest of you. >> then i'll go to the ranking member, senator coburn, for his

opening remarks. thank you. >> mr. chairman, thank you. i believe the video privacy protection act has become antiquated given all the new technology that's out there. and i would just note that you right now can share your music preferences through spotify by signing up one time. you can share your book preferences by signing up one time. you can share your television programs through hulu through signing up one time. and news articles through social reader by signing up one time. i think the chairman of the subcommittee makes some good points, and i am anxious to hear congressman watt and his thoughts on this. i did have a chance to talk to your ranking member yesterday. and hear his input in it. and i look forward to the input. thank you, mr. chairman. >> thank you to the ranking

member. i think we'll go to our first witness. that's what the chairman would like. and what the chairman would like, chairman gets. our first witness is the honorable melvin l. watt, distinguished representative for north carolina's 12th district. he's represented the people of the 12th district since 1992. representative watt serves on the house judiciary committee where he is the ranking member on the subcommittee on intellectual property, competition and the internet. prior to his election to the house of representatives, representative watt practiced civil rights law for more than two decades. he received his jd from yale law school and his bs from the university of north carolina. representative watt, welcome, and the floor is all yours. >> thank you, chairman franken and ranking member coburn, senator leahy and members of the

subcommittee. i'm truly honored to have this opportunity to address the subcommittee about the amendments proposed in hr-2471 to the video privacy protection act. and consumer privacy in this rapidly evolving digital age. while i am the ranking member of the house judiciary committee's subcommittee on intellectual property, competition and the internet, the views i expressed here today are my individual views and i do not speak for the committee or the subcommittee. i believe there are countless reasons to oppose hr-2471 which relate both to what the bill does and what it does not do. and how that fits into the broader debate about how best to protect individual privacy in the volatile online environment. it is particularly timely that the subcommittee holds this

hearing today,al online privacy has been at the forefront of discussion for the past few years. has been a recent flurry of more intense discussion that i believe make your hearing timely. business leaders, consumer advocates, state and local elected representatives and officials from each branch of the federal government have all weighed in with a variety of concerns and proposed solutions to address the absence of a uniform framework or approach to safeguard individual information in the thriving online environment. attention has appropriately intensified as two internet giants, facebook and google, have come under scrutiny for their data usage policies and practices. likewise, netflix, the main proponet of this bill, has had more than its fair share of

regulatory complaints and consumer lawsuits with regard to the handling of user information. in the coming weeks, both the ftc and the department of commerce are expected to issue long anticipated final reports on online privacy policy based on a series of roundtable discussions with relevant stakeholders and following up on their initial studies in 2010. senators kerry and mccain in the senate, representative cliff stearns in the house last year introduced comprehensive legislation designed to prescribe standards for the collection, storage, use, retention and dissemination of users' personally identifiable information. and these bills generated debate more generally in the halls of congress. this subcommittee also held hearings to address the security of sensitive health records and personal privacy on mobile

devices. and last week, in deciding whether gps tracking violates a criminal defendant's fourth amendment right against unreasonable search and seizure, a majority of the justices of the supreme court acknowledged the challenges we confront as a society in determining the so-called new normal for privacy expectations in the digital age. against this backdrop, i'll direct the remainder of my comments to hr-2471 which passed the house under suspension of the rules. while i may not always avail myself of all the new technology and revolutionary tools and services available over the internet, let me say at the outset that i applaud the explosion of technological advances that has transformed forever the way we communicate and transact business. while i support innovation on

the web, however, i cannot do so at the expense of individual privacy. given the gravity of issues involved, i believe it was a mistake for this bill to move through the house under the radar and without the benefit of a single hearing. but my concerns are not just about process. i believe that hr-2471 would have unintended negative consequences for consumers, as well as affected businesses that will undoubtedly lose the confidence of their subscribers with their first privacy violation or data breach. consumer desire have access to the next cool tool should not be mistaken for the voluntary surrender of fundamental privacy interest. in addition to the like of thoughtful process in the house, i believe there are at least four substantive problems with

hr-2471. first, the bill leaves unaddressed the question of who the bill applies to, which i believe creates collateral but important intellectual property enforcement concerns. by declining to define what constitutes a videotape service provider, under the vppa, hr-2471 leaves open the possibility that accidents that provide video on demand over the internet with dual distribution platforms can avoid or delay compliance in copyright enfringement. second, the debate on hr-2471 centered on online experiences of consumers with social media

like facebook. however, the bill as passed applies a physical and applies to physical and online videotape service providers alike and disclosures authorized to any person, not only friends on facebook. consequently, a consumer's private information is vulnerable to release to third parties like the news reporter who published the video rental history of judge robert bork that paved the way to enactment of the video privacy bill. third, despite claims that the video privacy protection act is outdated, only a sing patrol vision of the statute was updated, leaving consumer oriented provisions that should have been reviewed and strengthened unaltered. fourth and finally no, consideration was given to the

effect that changes in the video privacy protection act will have on state laws that afford similar and sometimes broader protections to consumers. this oversight is likely to invite thorny conflict of laws, disputes given the borderless boundaries of the internet. while internet users have a responsibility to self-censor and restrict the information they share about themselves, the reality is that many online users have a false sense of privacy due to their lack of understanding of lengthy and complex privacy policies they are compelled to agree to in order to use the service. as a result, online users often share a lot of personal information unknowingly and to unintended audiences. i do not believe that unsuspecting, unsophisticated or

casual internet users should be deemed to relinquish their right to a basic level of privacy. and my concerns are heightened even more when the user is a vulnerable teen or a young adult whose ability to adequately assess risk has not fully matured. third party access to dynamic social platforms are constantly in flux. a consumer's consent today to allow perpetual access to their viewing history is clearly not informed by who will be their friend tomorrow. today when online bullying of teen and young adults can lead to depression or even suicide, and online predators can learn otherwise confidential private information about their prey, i believe the selective and piecemeal amendment of the video privacy protection act is -- was

irresponsible. is irresponsible. as one commentator has written, movie and rating data contains information of a more highly personal and sensitive nature. the member's movie data exposes a member's personal interest and/or struggles with various highly personal issues, including sexuality, mental illness, recovery from alcoholism and victimization from incest, physical abuse, domestic violence, adultery and rape. justice marshall wrote years ago that privacy is not a discreet commodity, possessed absolutely or not at all. the objective is to strike an appropriate balance between meaningful protections for consumers and promoting a healthy online economy. i do not believe that hr-2471

has found that appropriate balance. i support a comprehensive online privacy plan that will address and mitigate the unintended consequences of third party sharing. in that regard, i believe justice alito got it right when he said, quote, in circumstances involving dramatic technological change, the best solution to privacy concerns may be legislative. a legislative body is well situated to gauge changing public attitudes, to draw detailed lines and to balance privacy and public safety in a comprehensive way, close quote. this hearing is an important step toward finding the right balance, and it is more critically important because the house failed to give the matters the kind of attention they required. i thank the chairman for this opportunity and look forward to

working across the capital to move forward. thank you so much. >> thank you, representative watt. and that's the purpose of this is to give a hearing to all these matters and issues. your complete written testimony will be made part of the record. and we have -- we're fortunate to have with us chairman leahy who is the author of the original video privacy protection act or the video privacy protection act. and i understand that i left out allan simpson's role when i touted -- >> allan was very important in that. >> so i apologize for that. a good friend. today, this law is just -- the video privacy protection act is just one of several critical privacy laws that chairman has written and passed during his tenure in the senate.

so i turn it over to the chairman. >> i thank you very much. and it's good to see my friend, congressman watt. we have worked together on so many things from privacy issues to voting rights act, and i appreciate that collaboration. i should tell chairman franken, and i thank him for his responsible leadership he's done on this issue of privacy. we have come about it naturally. i see the smile from a friend of mine in the audience who probably has heard this story more than once. but one of the few things i've ever saved written about me in the press, and actually framed it was a sidebar to a "new york times" profile. i put this in perspective. you have to understand, my wife and i live in an old farm house in vermont on a dirt road. we celebrated our -- well,

actually part of our honeymoon there nearly 50 years ago. 50 years ago this summer. and hundreds of acres of land and fields and all that have been hayed and watched over by an adjoining farmer's family from the time i was a teenager. and they've known me since then. so the whole story goes like this. this saturday morning reporter in an out of state car sees this farmer on the porch. does senator leahy live up this road? he said are you a relative of his? he said, no, i'm not. are you a friend of his? no, not really. is he expecting you? no. never heard of him. we like our privacy in vermont. and in the digital age, ensuring the right to privacy is critical. but i think because evermore difficult is our government and businesses collect and store and mine, use our most sensitive personal information for their own purposes, not ours, but

theirs. whether it's sensitive medical records, private financial information, personal thoughts and feelings. i worked, as so many others on this committee have, to ensure that americans' privacy rights are respected. we talked about the video privacy protection act. when i introduced the bill isaid does it intend to make us all a little freer to watch what we choose without public scrutiny? more recently iworked at protections for library and book seller records in section 215 of the usa patriot act. it's true technology has changed. the chairman mentioned what justice alito said. but i think we should all agree we have to be faithful to our fundamental right to privacy and freedom. to the social networking and video streaming, cloud, mobile apps, other new technologies they've revolutionized the

availability of americans' information. but they're also outpacing our privacy laws. that's one of the things we have to think about. so i continue to push to enact the personal data privacy and security act to create a nationwide data breach notification standard. want to better combat cybercrime. that's why i propose the review and update of the electronic communications privacy act. recently some companies that dominate various aspects of cyberspace have announced they want to simplify matters so they can more easily track americans' activities across the board. obviously, to their own financial benefit. but i worry that sometimes what is simpler for corporate purposes is not better for consumers. it might be simpler for some if we had no privacy protections. if we had no antitrust

protections, no consumer protections. it would be simpler for some but it certainly wouldn't be better for americans. certainly not better for americans and i worry about loss of privacy. privacy advocates like to present us with the both sides of the aisle, serious questions looking for information and answers. when dominant corporate interests may seem like a fun new app or service, they may not be presenting realistic informed choice to consumers. a one-time check has an all-time surrender of privacy. doesn't seem like the best course for consumers and i worry about the corporate data mix also makes it readily available to the government but also power

to obtain information with so-called national security letters. so i think we need a comprehensive reform. a thoughtful leader on these issues, it's good that he's here. and i'm hearing that the privacy implications key concerns, the one-time check off consent, disclose and sell, sell, sell and share information does not adequa adequately protect consumers.

so we need to move forward and best update the video protection act. so i'm -- i just want to thank the chairman for doing this. and i evidence don't like it when somebody says we're going to make life simpler if we sell your privacy. >> thank you, mr. chairman. we are now going to go to the second panel. thank you again, representative watt. you were the first panel, evidently. so if the panel would come forward, i'd like to introduce our second panel of witnesses david hyman is the general

council of netflix. mr. hyman has seen the company grow tremendously. during that period, prior to joining netflix, he was the general counsel of an internet-based grocery delivery service. he received both his jd and mba from the university of virginia. bill mcgovern is an associate process for of law at the university of minnesota where he specializes in information law, including digital identity and data privacy. before joining, he was a resident fellow for internet and society and a litigator in boston. he received his jd from nyu and b.a. from carlton college in minnesota. he was once a staffer for senator schumer back in the days

in the house of representatives. mark road den berg is the executive director of the privacy information center where he -- which he co-founded in 1994. he chairs the american bar association committee on privacy and information protection and has edited several privacy law experts. g again, he was counsel to senator leahy where he advised the senator on the law that we are considering today, the privacy act. christopher wolf is part of the privacy management here in washington and he's founder and co-chair of the privacy forum.

he was lead author on privacy law and has offered numerous publications on privacy. he received his a.b. from boden college. i want to thank all of you for being here today. and we'll start with mr. hyman. >> thank you for the opportunity to testify today on the video privacy protection act. my name is david hyman i have served with netflix since 2002.

\s >> while it's early in the innovation process, we've seen strong consumer application with more than half a million subscribers outside of the united states connected with

facebook. we have not elected to offer our facebook application base of ambiguities in the privacy protection act. unlike most federal privacy statutes, it could be read to offer explicit consent to authorize disclosure on information that they so desire to share. the friction places a drag on social innovation that is not present in any other median, including music, books, and articles. recognizing this, the house recently passed by partisan bill hr-2471 that clarifies the

ability to leave the opt-in standard for privacy undisturbed. we believe this approach is workable and consistent with our members' expectations and desires. the bppa singles out one kind of data sharing. we could encourage and measure holistic review for the 21st century. one designed to balance the desires and privacy expectations of consumers. such a review will understandably take considerable time and effort and we are ready to assist. in the interim, it's our hope that the senate will see the value and quickly approve hr-2471. again, i thank you for the