Netflix Prize 2 crowdsourcing contest killed due to privacy concerns

Netflix nixes contest following the filing of a lawsuit and FTC discussions

Netflix announced on Friday that it is killing a contest announced last September designed to offer the public big money for helping the company come up with a better way to gauge movie watchers' preferences.

From Chief Product Officer Neil Hunt, on the company blog:

"In the past few months, the Federal Trade Commission (FTC) asked us how a Netflix Prize sequel might affect Netflix members' privacy, and a lawsuit was filed by KamberLaw LLC pertaining to the sequel. With both the FTC and the plaintiffs' lawyers, we've had very productive discussions centered on our commitment to protecting our members' privacy.We have reached an understanding with the FTC and have settled the lawsuit with plaintiffs. The resolution to both matters involves certain parameters for how we use Netflix data in any future research programs.In light of all this, we have decided to not pursue the Netflix Prize sequel that we announced on August 6, 2009."

AT&T Labs-Research, Yahoo Research and other members of the Bellkor's Pragmatic Chaos team  in September celebrated their win in the inaugural 3-year-long Netflix Prize contest. They earned $1 million in beating out 40,000 other teams from 186 countries to improve upon Netflix's Cinematch system for predicting which movies customers will like or dislike.

No sooner did Netflix hand out its prizes than it announced Netflix Prize 2, which was to reward winners at 6 and 18 months.

But the new contest immediately raised privacy concerns among some.  Blogger Paul Ohm (an associate professor of Law at the University of Colorado Law School) said he respected the effort Netflix went to to protect customer data handed to contestants in Netflix Prize 1, but had serious privacy concerns about Netflix Prize 2, which involved dishing out demographic, gender and other data.

Netflix's Hunt says the company will continue to look for ways to work with research community to improve its recommendation system.

(Meanwhile, guess we should add this to our 2010 technology industry graveyard list....)

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