Last week, Viacom announced that it would file suit against Youtube, seeking damages of $1 billion dollars.
I do not believe that the core issue of the suit is whether or not Youtube was following the rules of the 1998 DMCA - Digital Millennium Copyright Act - wherein content uploaders are blamed for piracy, not providers. Lawsuits only happen when there's something to gain from the conflict - legal fees are exorbitant.
The issue is:
How much of a cut of the advertising revenue should be paid to Viacom?
According to the two correspondences to Youtube issued by Viacom, there were a total of 160,000 videos that could be claimed as copyright infringement, displayed on Youtube.
In terms of a dollar value of revenue lost by the distribution of those videos on Youtube, for free, Viacom is demanding $1 Billion dollars, on average, $6,700 per video.
Youtube's response is:
It's not OUR fault, it's the individual uploaders! How can you blame us for something that we didn't do! (Paraphrased from the DMCA.)
Does Google's Youtube have a chance with this argument? That depends on a few issues:
1. It's obvious that Viacom has previously issued complaints to Youtube. The suit has only come after more than one request.
2. Under the DMCA, Youtube's response would be to destroy the uploaded content that infringed upon copyright, upon notice.
Therefore, Viacom is issuing that suit because Youtube is not complying fast enough - or, perhaps because the value of the videos has not been translated to revenue for Viacom.
What I predict might happen:
OUTCOME 1
Youtube settles with Viacom for an undisclosed amount. That amount would be less than $1 Billion. Youtube removes all copyrighted material, sets up a better way to find copyrighted material. Viacom provides more content with a better fee from advertising revenue.
OUTCOME 2
Youtube does not settle with Viacom. Youtube wins the lawsuit, successfully defending with the 1998 DMCA. Viacom has no other recourse than to go after individual copyright impingers. Individuals who have shared videos will be sued for the content that they have uploaded to Youtube. Viacom becomes a sort of RIAA bill-collector, allowing people to pay off their judgements online, via credit card.
OUTCOME 3
Youtube does not settle with Viacom. Youtube loses the lawsuit, Viacom proves that Youtube has infringed on copyrights, or negligently colluded to allow copyright infringement. Youtube ordered to pay Viacom $1 Billion dollars. Youtube removes all copyrighted material. Youtube implements stricter standards.
With these three outcomes, pirates STILL move to different flash-video providers, regardless of what happens. Youtube becomes a haven for individuals, with less content from providers...apparently.
The question that Viacom has to answer is: How can we make money in these three outcomes?
The resolution that makes sense, besides becoming like a giant RIAA copyright infringement collector, or grabbing some of Youtube's riches, is to rig up a better revenue system for Viacom, and allow a similar level of anarchy on Youtube. (Pennies per click, with advertisers competing for positions on
After all, Viacom does not want to lose an audience.
Youtube does not want to lose an audience, either. They have to compete with paid services, and the upcoming video service from News Corp and NBC. Youtube is owned by Google, and Google has some smart business planners, they probably know that some of the videos on the site are copyrighted.
Google would much rather make a cut of the advertising revenue and allow the freedom of Youtube to continue. Google's motto is:'Don't be Evil', right?
What does this mean to you?
There are plenty of alternatives to Youtube to watch uploaded copyright material; just Google them.