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Netflix Forms Political Action Committee

9 Apr, 2012 By: Erik Gruenwedel

Netflix has joined other corporations and political activists by forming a political action committee (PAC), which allows it to directly contribute up to $5,000 to candidates in federal elections, including Congress and the president.

Filed April 5 and called FlixPAC, the political action organization allows individuals and corporations to donate funds for political and activist agendas — a strategy Netflix has sought since spending $20,000 employing Washington, D.C.-based lobbyists in 2009, according to the filing disclosed on fan site HackingNetflix.com.

Netflix, which is spearheading the streaming-based subscription video-on-demand market, is interested in influencing federal legislative efforts regarding video piracy, intellectual property and Internet privacy, among other issues. Indeed, the Los Gatos, Calif.-based rental service spent $500,000 in 2011 on lobbying efforts targeting the Video Privacy Protection Act, according to the service.

Earlier this year, capital lawmakers postponed action on VPPA, the Stop Online Piracy Act and the protect IP Act following protects by select websites and digital civil liberty groups.

"PACs are commonplace for companies that lead a big, growing market and Netflix is no exception," said a Netflix spokesperson in a statement. "Our PAC is a way for our employees to support candidates that understand our business and technology.  It was not set up for the purpose of supporting SOPA or PIPA.  Instead, Netflix has engaged on other issues including network neutrality, bandwidth caps, usage based billing and reforming the Video Privacy Protection Act."

Separately, Netflix disclosed that 75% of subscribers rent content based on recommendations created by user feedback and internal company algorithms. In the first of two posts on Netflix tech blog, company engineers explain the history of its recommendation software, which began in earnest with the launch of streaming in late 2007.

Interestingly, Netflix engineers Xavier Amatriain and Justin Basilico said spiked interest in recommendation technology occurred as the number of streaming subscribers grew — a market segment that required content recommendations more quickly than disc subs.

With access to Netflix increasing exponentially with links available on consumer electronics devices such as Xbox 360, PlayStation 3, Android devices, iPhone, iPad, Roku media player and connected Blu-ray Disc players and TVs, the need for reliant and speedy recommendation software became paramount.

“For DVDs, our goal is to help people fill their queue with titles to receive in the mail over the coming days and weeks; selection is distant in time from viewing, people select carefully because exchanging a DVD for another takes more than a day, and we get no feedback during viewing,” Amatriain and Basilico wrote in the blog. “For streaming, members are looking for something great to watch right now; they can sample a few videos before settling on one, they can consume several in one session, and we can observe viewing statistics such as whether a video was watched fully or only partially.”

Finally, Netflix said it no longer will automatically restart subscribers' service following vaction holds unless specifically authorized to do so. Previously, Netflix automatically restarted service 90 days after a subscriber requested a temporary stop due to vacation.

Netflix reports first quarter (ended March 31) results April 23.


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