Lawsuits Smawsuits

Moby DickThe Wall Street Journal (sub req’d) has a big article today on the copyright issues surrounding YouTube and potential litigation. The piece discusses a group of major media companies that have “banded together to explore the legal implications of the video site’s unauthorized use of copyright material”:

[The members of the group], which includes News Corp., General Electric Co.’s NBC Universal and Viacom Inc., have concluded that YouTube could be liable to copyright penalties of $150,000 per unauthorized video, people familiar the matter say. Viacom believes that pirated versions of video clips from its cable channels — including MTV, Comedy Central and Nickelodeon — are watched 80,000 times a day via YouTube. At that rate, potential penalties could run into the billions of dollars. unauthorized use of copyright material, people familiar with the matter say.

The journal characterizes the formation of the group as “an apparent display of saber-rattling aimed at nudging video Web site YouTube Inc. into cutting favorable licensing deals.”

Lawyers love to posture. Indeed, that’s precisely what it is. (Here’s my post from yesterday on the same subject.)

These guys all love and hate both YouTube and Google. The love it because of all the exposure and promotion they get (recall how unauthorized streams of skit “Lazy Sunday” boosted ratings for NBC’s SNL and triggered a deal with YouTube). And for similar reasons people both love and hate Google — they like the distribution but hate the dependency.

So this is probably very delicious for these companies who both need GoogTube and are fearful and envious of the “two kings” (to quote Chad Hurley’s “Sally Field moment”).

Evidence of this ambivalence is reflected in the many mixed messages in the marketplace. You alternately read stories like the one referenced above about litigation and those, just a day or two earlier, that discuss the likely expansion of the Google-MySpace relationship (also WSJ).

YouTube in fact became popular because of the appearance of so much copyrighted content (the so-called “head” in this case), which in turn attracted people to explore the user-generated stuff (“the tail”), along with pure voyeuristic curiosity. Without the unauthorized material YouTube wouldn’t have broken out like it did. But now that will all be replaced by licensing deals with companies that have an interest in tapping GoogTube’s promotional muscle.

But for these content producers to complain that they’re damaged (legally or otherwise) is a little disingenuous (see the SNL example above and my “Grateful Dead post.“) If they can figure it out, most of these media companies stand to gain much more through a deal with GoogTube than from suing the company.

As Alex Zubillaga, Warner’s EVP for digital strategy correctly put it in an interview with the WSJ, “This is a phenomenon which kids have embraced which is only going to continue to grow . . . We’re much better innovating and embracing this than trying to stop it.”

He’s right.

These media companies now “get it” and all the talk of lawsuits — even the potential filing of lawsuits — is about creating a stronger negotiating position and nothing more.

2 Responses to “Lawsuits Smawsuits”

  1. Sunday Miscellany « Screenwerk Says:

    […] The other two stories (about Google) are a review of the YouTube deal and why it makes sense (least interesting of the three) and then about how Google is becoming “synonymous with the Internet” for many young people. The latter also talks about privacy issues and some user ambivalence (not unlike corporate ambivalence) about becoming so embroiled in “Planet Google.” […]

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