Reed Hastings and His Facebook Posts

Netflix CEO Reed Hastings, on Facebook:

In early July, I publicly posted on Facebook to the over 200,000 of you who subscribe to me that our members had enjoyed over 1 billion hours in June, highlighting how strong our content was. There was press coverage as there are many reporters and bloggers among you, my public followers. Some of you re-posted my post. Again, we did not also issue a press release or file an 8-K about this.

SEC staff informed us yesterday that they are recommending that the SEC bring a civil action against us for my July 1 billion hour public post, asserting we violated “Reg FD”. This rule is designed to ensure that individual investors have equal access to information as large institutional investors, by prohibiting selective disclosure of material information. The SEC staff believes that I gave you all “material” investor information in my post and that we needed to instead release the June viewing fact “publicly” with an 8-K filing or press release.

This seems bogus, no? Is not a public Facebook posting the modern equivalent of a press release?

Update: Next time he should post on Google Plus — that way no one would notice.

Update 2: Based on my email, it seems like a lot of people are confused about the public nature of these posts from Hastings. These aren’t things that are only visible to other Facebook users, or to people who follow Hastings on Facebook. They’re public posts, visible to anyone who visits the URL, just like blog entries. The best argument I’ve seen against Hastings actions is not about the public/private distinction, but that this was his personal account, not the company’s account.

Thursday, 6 December 2012

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