Viacom Vs. YouTube: It Is So On

Mar 13th, 2007 // 7 Comments

_42577785_youtube203.jpgThis morning, Viacom filed a federal copyright-infringement lawsuit against YouTube and Google, alleging that almost 160,000 unauthorized clips of Viacom’s programming were available on the video-sharing site, and that they’d been watched more than 1.5 billion times. Now, Viacom is looking to get paid–to the tune of more than a billion dollars:

“YouTube is a significant, for-profit organization that has built a lucrative business out of exploiting the devotion of fans to others’ creative works in order to enrich itself and its corporate parent Google. Their business model, which is based on building traffic and selling advertising off of unlicensed content, is clearly illegal and is in obvious conflict with copyright laws. In fact, YouTube’s strategy has been to avoid taking proactive steps to curtail the infringement on its site, thus generating significant traffic and revenues for itself while shifting the entire burden – and high cost – of monitoring YouTube onto the victims of its infringement.

This behavior stands in stark contrast to the actions of other significant distributors, who have recognized the fair value of entertainment content and have concluded agreements to make content legally available to their customers around the world.

There is no question that YouTube and Google are continuing to take the fruit of our efforts without permission and destroying enormous value in the process. This is value that rightfully belongs to the writers, directors and talent who create it and companies like Viacom that have invested to make possible this innovation and creativity.

After a great deal of unproductive negotiation, and remedial efforts by ourselves and other copyright holders, YouTube continues in its unlawful business model. Therefore, we must turn to the courts to prevent Google and YouTube from continuing to steal value from artists and to obtain compensation for the significant damage they have caused.”

We’re guessing that most of the clips Viacom is suing over are from The Daily Show and Letterman, although we’re curious if reposting videos with the MTV or VH1 Classic bugs counts as “infringement” (if so, that explains the inflated watch-count). But even if it’s not dealing directly with music, this case is worth keeping an eye on because of its precedent-setting possibilities–if it ends with Google forking over money to Viacom, expect the major labels to rush in with lawsuits of their own. (Hey, it’s a revenue stream, right?)

Viacom Files Federal Copyright Infringement Complaint Against YouTube and Google [Yahoo! Finance]

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  1. NakedMickeyThomas

    The irony to me is that MTV made its business on the back of record label money and the artistic vision of a whole bunch of bands and music video directors, i.e. “other people’s works,” who weren’t being paid by them.

  2. Deadly Tango

    This lawsuit is really just the follow-through to (1) Viacom’s deal with Joost (the new streaming video deal from Niklas and Janus, the original Kazaa and Skype developers) and (2) last week’s $10 million settlement with Bolt.com. It’s no real surprise that Viacom is taking this approach.

    Dennisobell, I agree that everyone associated with media and on-line industries is deathly afraid of any formal interpretations of the DMCA “safe harbor” provisions. Mark Cuban and others have made fairly convincing arguments that the facts of this lawsuit are pretty ugly, and lawyers have long said that “bad facts make bad law.”

    Unlike you, I expect a settlement after a little discovery occurs. Neither side can afford the risk of even a preliminary adverse ruling with a 10-digit price tag (whether in payouts by Google or in lost revenues to Viacom). There just isn’t enough reliable precedent on the DMCA safe harbor to allow the lawsuit to proceed too far.

  3. Chris Molanphy

    @DeadlyTango: Thanks for the excellent explanation/expansion of what I was saying. And you make a good point about settlement being more likely than a ruling. Although that in itself would be horrible precedent too, wouldn’t it?

  4. Deadly Tango

    @dennisobell: Settlement would be par for the course — from what I can see on the EFF’s excellent DMCA wiki, no cases that would revoke a service provider’s safe harbor have been taken all the way to the finish.

    What would be most horrible is for some small ISP to get sued, not be able to defend itself adequately, and be stripped of a DMCA safe harbor defense. The current lack of legal precedent (other than out-of-court settlements) winds up being positive for service providers, since they can still operate under the basic assumption that a safe harbor does exist.

  5. 30f

    I would say that MTV’s making of money off “other peoples work” came after the labels agreed to let MTV show videos for free. And since the artists and music video directors had contracts with those labels that said the record companies owned the “work,” the directors and artists were legally out of luck. This is a very different situation than YouToogle making ad revenue off something they have no real claim to. MTV is/was ripping off people who had at least agreed to the screwing, YouToogle is acting like they have no idea what those kids are posting while they waqych the Google ads.

    I concur that a settlement is the most likely outome. Both sides are more scared of defeat than they are excited about victory (which would be challenged and appealed for decaes anyway) – so look for something nice to happen before they get in front of a judge.

    Things keep changing and they are not getting any better for the old-school players.

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