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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
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.

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
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:
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
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 Xerstead on 3/13/2007 6:48:19 PM , Rating: 2
This analogy would be more accurate if the drug dealers brought their drugs into the store, left them on a shelf to be viewed and sampled by the shops customers.
In this scenario the store could: Remove the drugs, ban the dealers from the store and inform the relavant authorties. From the reports, Google is reluctant to be proactive in any of these points.

RE: Two things...
By Ard on 3/13/2007 4:09:00 PM , Rating: 2
Can't say I see this lawsuit as being frivolous. Viacom has a duty to protect their IP, plain and simple. While some of their rationales are a bit out there, it doesn't change the fact that users are blatantly infringing Viacom's works by posting them on YouTube. Moreover, while their logo may very well be visible, YouTube denies them the normal flow of revenue that comes with the license agreements associated with broadcasting their programs.

RE: Two things...
By rika13 on 3/13/2007 4:12:40 PM , Rating: 1
actually, the law is on Google's side;

DMCA gives them protection as an "online service provider" and MGM vs Grokster protects them since they are not affirming themselves as a service for piracy, they promised the organized criminals (aka the RIAA and MPAA) a filter, however such a promise being broken means nothing as it is not a CONTRACT, thus the forward looking statements laws apply

RE: Two things...
By NuroMancer on 3/13/2007 4:25:43 PM , Rating: 2
The anti-piracy system to be in place by the end of 2006 was a part of a deal which allowed Google to distribute Warner music videos, artist interviews and other music-related content.

So, while Viacom may noe have as much of a case, perhaps Warner does.

I agree MGM vs Grokster does tend to make me think Viacom will get no-where in this lawsuit. The Supreme court found that a distributor cannot be held liable for users' infringement so long as the tool is capable of substantial noninfringing uses

RE: Two things...
By Ard on 3/13/2007 4:38:18 PM , Rating: 2
The rationale you're stating is an offshoot of the staple article doctrine of patent law, articulated in copyright law by the Supreme Court in Sony v. Universal (also known as the Betamax case). It was merely upheld in MGM v. Grokster. What the Grokster decision held was that a 3rd party can be contributorily liable for the actions of its users if it can be shown that they actively induced that infringement. The Court looked to Grokster's business models, advertising materials, and other documents in reaching that ruling.

Can Grokster help Google? It's possible. YouTube is clearly one of those products that has a substantial amount of non-infringing uses. It's more likely, however, that Grokster will hurt Google depending on YouTube's internal policies regarding copyright infringement. It's clear that, publicly, they've shown that they fully intend to respect others' IP rights; however, everyone knows that YouTube is also a magnet for copyright infringement and it's highly unlikely that Google doesn't know that. If their business model doesn't mirror their public sentiments, they could have a problem.

RE: Two things...
By Tupolev22m on 3/13/2007 6:01:42 PM , Rating: 2
Consider this passage from the DMCA:

“(c) Information Residing on Systems or Networks at Direction of Users.—
“(1) In general.—A service provider shall not be liable for monetary relief, or, except as provided in subsection (j), for injunctive or other equitable relief, for infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider, if the service provider—
“(A)(i) does not have actual knowledge that the material or an activity using the material on the system or network is infringing;
“(ii) in the absence of such actual knowledge, is not aware of facts or circumstances from which infringing activity is apparent; or
“(iii) upon obtaining such knowledge or awareness, acts expeditiously to remove, or disable access to, the material;
“(B) does not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity; and
“(C) upon notification of claimed infringement as described in paragraph (3), responds expeditiously to remove, or disable access to, the material that is claimed to be infringing or to be the subject of infringing activity.

Is the issue here whether Google/Youtube has the ability to control the gaining of advertising revenue from the infringement? Assuming we go with the fact that its an automated process and use that to say they don't, google would seem to be pretty much in the clear here from my perspective because they do remove things expeditiously as far as I know.

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