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Internet Viacom Sues Google for $1 Billion
Gabriel Ikram (Blog) - March 13, 2007 2:27 PM
Print E-mail del.icio.us 40 comment(s) - last by peferling.. on Mar 15 at 8:22 PM
One of cable's largest media conglomorates has opened the litigation against YouTube

Viacom today announced it has filed a lawsuit against Google in U.S. District Court for the Southern District of New York. Viacom filed the lawsuit claiming that Google intentionally committed massive copyright infringement of Viacom’s entertainment properties. The lawsuit seeks more than $1 billion in damages, in addition to an injunction that will prohibit Google/YouTube from further copyright infringement.

In its statement, Viacom said that “almost 160,000 unauthorized clips of Viacom’s programming have been available on YouTube and that these clips had been viewed more than 1.5 billion times.” Viacom would have greatly preferred these page views to have come from its own online video sharing website iFilm, so that it would have been able to receive advertising revenue.

Viacom also said Google, which acquired YouTube in 2006, 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.” Essentially,  fans of content not owned by Google are watching the “creative works” on YouTube while Google benefits from and exploits these users’ devotions to these T.V. shows.

Viacom went on to say that YouTube’s entire business model is “based on building traffic and selling advertising off of unlicensed content.” Viacom’s statement even says that Google is avoiding taking “proactive steps to curtail the infringement on its site.”  YouTube missed the anti-piracy deadline that it promised to deliver by January 2007.

Viacom is also unhappy that it has to police YouTube’s content and says that YouTube has placed “the entire burden – and high cost – of monitoring YouTube onto the victims of its infringement.”

Viacom believes that “YouTube and Google are continuing to take the fruit” of its efforts without permission while also “destroying enormous value in the process.” Viacom also added a little sentiment by saying the value “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.” Despite the added emotion, however, there is no doubt that the lawsuit centers on money.    

After unproductive negotiation Viacom believes that its only choice is to “turn to the courts to prevent Google and YouTube from continuing to steal” its content and to gain compensation for damages.

Prior to 2006, Viacom owned CBS broadcasting networks.  CBS Corporation has also scrutinized YouTube; the company recently declined a content sharing program that was slated for 2007.  Viacom, on the other hand, has chosen to partner with Joost for its online content sharing platform.

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Two things...
By creathir on 3/13/2007 3:33:13 PM , Rating: 5
One:
I do not agree with frivolous lawsuits, and the argument that Viacom is making is ridiculous. People will not stop watching TV because they can watch it on YouTube. There needs to be NEW content to watch in the first place. If they broadcast it, they risked someone copying it. As long as their logo is visible on the screen, I do not see what they are complaining about.

Two:
I sort of understand them protecting their IP. IP theft is extremely prevalent in today’s day and age, and without these types of protection lawsuits, it will only get worse.

I am really on middle ground here on this issue. Google goes to one extreme, Viacom to the other. From a law perspective, the law is on Viacom’s side. From a freedom perspective, Google's.

I think I would like to see this settled outside of court. I would like to have seen Google and Viacom come to an agreement. For now, it does not look like that is possible because of the ideology both sides are taking. Who loses in the end?

You and I do. Viacom wins the battle, Google removes content, we cannot post it anymore, YouTube goes to a system where the content is reviewed before being posted.

It will suck, just as it sucked when the RIAA killed Napster.

- Creathir




RE: Two things...
By Hare on 3/13/2007 3:41:14 PM , Rating: 4
quote:
the argument that Viacom is making is ridiculous. People will not stop watching TV because they can watch it on YouTube.[...] As long as their logo is visible on the screen, I do not see what they are complaining about.

I quess I missed that argument? All I found was this:
quote:
these clips had been viewed more than 1.5 billion times.” Viacom would have greatly preferred these page views to have come from its own online video sharing website iFilm, so that it would have been able to receive advertising revenue.

Sounds reasonable.

I mostly agree with the rest of your post. I've been waiting for something like this to happen. I don't think youtube can exist in it's current state.


RE: Two things...
By Orbs on 3/13/2007 3:48:59 PM , Rating: 2
I agree. I think the advertising revenue is the issue, and while yes it was broadcast at one point it was done so with advertisements meant for a specific market that paid for a timeframe.

By posting to YouTube, Viacom's advertisers are either left out or if the commercials aren't stripped, they end up getting more advertising than they paid for (sometimes inappropriately given the market which is why the online ads are shown instead).

Viacom is clearly in the right here however the real innovation that is likely to be curbed by this is Google's not Viacom's.

Whatever happens, I just hope that it doesn't end up with more DRM in this world. I really want to be able to watch (or listen to) whatever it is I pay for including broadcast content, wherever and whenever I want.


RE: Two things...
By Oregonian2 on 3/13/2007 4:45:57 PM , Rating: 1
Advertising is a lot more expensive than I would have thought. They are suing for $1B because they lost advertising revenue for 1.5B views. So each view of youtube's usually really crappy quality video lost Viacom $0.66 of advertising revenue. I would have guessed milli-cents, I'm off by many orders of magnitude! :-)

But yes, I can't imagine youtube to be a viable commercial entity. Only thing protecting it before was its lack of money (to be sued for).


RE: Two things...
By x2percentmilk on 3/13/2007 5:28:07 PM , Rating: 1
theyd have to prove that viacom lost those views, in my opinion, to have any argument at all.

i know that if youtube didnt exists, i still wouldnt go to their service for the content. they arent losing my customer status at all because they never had it.


RE: Two things...
By cochy on 3/14/2007 12:22:20 AM , Rating: 2
quote:
theyd have to prove that viacom lost those views, in my opinion, to have any argument at all.


Why? Can't they just prove that YouTube's servers are hosting thousands upon thousands of pirated materials?

If Bittorrent sites can be shut down for just helping people pirate (they dont' actually host the file they just supply the trackers) then YouTube servers should all be locked away from actually hosting the stuff.


RE: Two things...
By Aikouka on 3/14/2007 9:44:34 AM , Rating: 2
From what I see, Viacom's argument for requesting $1 Billion is because of loss of advertising revenue, not the act of having anything relating to their IP on Youtube.

I actually agree, I think Viacom's remarks are a bit overzealous and it almost reminds me of a piracy debate we've been having on the Anandtech forums. Sure, you can say, "Well, 200,000 users pirated my software," but the problem comes when you say, "Well, that means 200,000 users would've bought my software." I think just about any of us can come up with a decent reason why that isn't necessarily true.

I believe this also to be the same for Viacom's iFilm vs Youtube remark. Personally, I haven't visited iFilm since I stopped watching Angry Kid videos (or that's what I remember as the last time). Essentially, youtube has probably reached a status that google has in the search business. Instead of saying "go search the web" when referring to a video, people may say "go look it up on youtube" or even "go youtube it" (akin to saying "go google it"). In short, Youtube's mass appeal and overall market penetration is much higher than iFilm's appeal and penetration and I believe simply going for a 1:1 ratio of gain to loss is a gross overstatement.

Also, not to mention, saying something like, "Well, if they didn't go here, they would've gone there" is what's called a counter factual. The statement logically cannot be proven, because there's simply no facts that back it up. It's like saying "If Hitler wasn't alive, World War II never would've started." There's absolutely no way to prove that remark, although you're welcome to theorize.


RE: Two things...
By x2percentmilk on 3/13/2007 5:30:12 PM , Rating: 2
and another thing, how come grocery stores dont get in trouble when a car has drugs in it in their parking lot, but you tube gets in trouble for having illegal content on their website?


RE: Two things...
By Ard on 3/13/2007 5:36:55 PM , Rating: 2
I love when ppl come up with analogies that are completely irrelevant. The grocery store has no control over the car sitting in their parking lot. Even if you can make the argument that they have some modicum of control over the physical location in which the car sits, they certainly do not have control over the items inside that car.

That analogy is completely different than the instant case. YouTube, being the host, has complete and utter control over the content that appears on their website. While they certainly can't stop users from initially posting copyrighted material, they can prevent those users from continuing to post that material (by banning them) and prevent others from seeing the content by removing it at the request of the copyright owner.


RE: Two things...
By Lifted on 3/13/2007 5:42:59 PM , Rating: 2
I think the answer is more along the lines of Google making money from other companies copyrighted works, while the car w/ drugs in a parking lot does not make the business that owns the parking lot money so they are not endorsing it.


RE: Two things...
By Ard on 3/13/2007 5:49:36 PM , Rating: 2
That's certainly part of it to be sure. But ultimately it's still going to come down to who has the rights and control over the object in question.


RE: Two things...
By HibyPrime on 3/13/2007 5:49:27 PM , Rating: 2
The analogy is nearly perfect..

The grocery store has complete and 100% control of everything that enters the parking lot through the driveway, they just choose not to exersize that control, because if they did, they would loose 99% of their customers.

YouTube has 100% control of everything that gets hosted on the site through legitimate methods (read: not through hacking) but chooses not to exersize that control, because if they did, they would loose 99% of their viewers.


RE: Two things...
By HibyPrime on 3/13/2007 5:51:45 PM , Rating: 2
I should have said YouTube would loose 99% of their hosters, not viewers.

Sorry.


RE: Two things...
By Ard on 3/13/2007 5:55:15 PM , Rating: 2
No, it isn't. The grocery store has no control over anything that enters it parking lot legally unless they actually own the plot of land, at which point the parking lot would be considered private property. However, even if the parking lot is private property, the grocery store does not have control over what's in the car because the car does not belong to them. Constructive possession attaches to the owner.

The problem with the analogy is that the grocery store is too removed. You're trying to attach criminal liability based on the fact that illegal drugs are in another person's property which is sitting on private private property. In other words

A's drugs -> A's car -> B's land

B has no knowledge of the drugs at all and shouldn't be liable for them, especially since he can't exercise control over them. This is completely different from YouTube, who can, and does, exercise control over the content posted on its website.

A's content -> B's website


RE: Two things...
By HibyPrime on 3/13/2007 6:08:14 PM , Rating: 2
Regulating control on what can be seen in any community area (company owned or not) is completely the same as having grocery store employees inspecting the cars before they enter the parking lot.

I'm sure that having the grocery store employees inspect the cars before they enter the parking lot breaks more than a few laws, as should inspecting users files. Believe it or not, the users do own the files, in that they reside on their hard drives.

What should be done here is that Google should be splitting its profit between the companies which own the copywrights to the material, which we have seen that google is willing to do, to an extent. That seems like a solution that's better for everyone (google, viacom, you and me) that just suing google..

BTW I am assuming the grocery store owns the parking lot here.


RE: Two things...
By HibyPrime on 3/13/2007 6:10:01 PM , Rating: 2
I should add that they own the files on their hard drives, because they obtained them through lawful methods (ie. recording a TV show). I am not implying that uploading these files to the masses is legal.


RE: Two things...
By Oregonian2 on 3/13/2007 6:42:06 PM , Rating: 2
I know I've had my car inspected (actually it was my mother's car that I had borrowed when visiting) entering a Las Vegas Casino parking lot (along with all other cars coming in at the time) -- back closer to the 9/11 happening. So parking lot searches of cars for illegal stuff isn't something that doesn't happen.

P.S. - My Mom's car passed (she lives in a Suburb of Vegas).


RE: Two things...
By Ard on 3/13/2007 7:57:45 PM , Rating: 2
Actually, having the employees inspect cars wouldn't break any laws, save for one's inherent right of privacy, which is subsequently waived upon receipt of consent. There's also the issue of the plain view doctrine and the fact that illegal searches and seizures only matter if an agent of the government is involved.

In any event, I agree with your end analysis. Google should be sharing some of it's profits with major content providers since they know that works are clearly being infringed. It takes the heat off of them and makes YouTube a legitimate interest going forward. And, in all likelihood, that will probably be the end result of this suit once a settlement is reached. This is merely Viacom's way of telling Google that they're serious about protecting their content.