Although the first Netflix prize was very successful, Netflix recently cancelled the 2nd Netflix Prize after FTC expressed privacy concerns and a lawsuit was filed.
The privacy concerned were sparked by 2 researchers,
Arvind Narayanan and Vitaly Shmatikov,
who showed that some people who rank obscure movies can be identified by correlating their rankings to other online information, such as IMDB rankings
Although these researchers wrote an open letter to Netflix arguing for more research and privacy-preserving data analysis mechanism, it seems doubtful that this would happen.
The new KDnuggets Poll is asking:
Is it still possible for companies like Netflix to anonymize large datasets?
Please vote on www.kdnuggets.com
See also How Privacy Vanishes Online (New York Times), which makes the point
... individual actions are rarely enough to protect privacy in the interconnected world of the Internet. You may not disclose personal information, but your online friends and colleagues may do it for you, referring to your school or employer, gender, location and interests. Patterns of social communication, researchers say, are revealing.