Youtube has a huge problem and they have dug a hole so deep they are never going to be able to fix it unless they change their approach to copyright.
There is no reason to discuss further whether or not Youtube or Google Video is elgible for protection from the DMCA. That topic will be decided by the courts. The question now is whether or not using the DMCA is a good business decision.
The fundamental business issue in claiming protection behind the DMCA is that it requires Youtube to not know what videos are on its site. Unless an uploader is copyright owner that has signed a deal with Youtube giving them knowledge of the videos they will be uploading, by law Youtube can't have any idea what videos are on the site or where.
Think about that for a minute.
How hard is it to sell advertising around content when you have no idea what the content is ? Its impossible. Its like selling advertisers a lottery ticket , and we all know how good an investment a lottery ticket is for the ticket buyer. For some reason the media seems to think that there isn't advertising on Youtube because of advertisers fear of User Generated Content. Thats not it. Volume impressions are still sellable. As is volume video. There is a huge market for mass video. Unfortunately for Google, they take a huge risk of liability from the DMCA in generating revenue next to copyrighted materials they don't have permission for. So to play it safe , they don't sell advertising around videos they don't have licenses for.
So what is happening amounts to Google basically subsidizing the hosting of video for the entire internet. Fortunately for Google, they are probably the only company that could afford to lose that much money a year which has to run into the 100s of millions of dollars per year at this point.
Unfortunately for Google, even with their new attempts to protect copyright, it doesn't change the particulars of how they have to follow the DMCA and what their advertising sales options are.
Which leads to this question. Should Google start proactively checking uploaded videos for copyright violations and if they did, how would it change Youtube and its relationship with copyright owners, visitors , advertisers and their bottom line ?
It wouldn't be a technical challenge to review for copyright. It wouldn't be a financial challenge in hiring and training the thousands it would take to review the videos after all, this process would allow Google to finally know what content they have and sell ads around the videos. And it wouldnt be a difficult evaluation process. A quick smell test would be easy, with any uncertainty being sent to uploader for confirmation of ownership,
Would the number of videos uploaded and allowed fall off a cliff ? Does the take down notice process actually work, which would mean that there is no real net affect on the number of videos available to visitors ? Would users get so upset they would find another site that flaunted the DMCA as a replacement ?
If there is a chance that Google loses any of the many lawsuits and faces Billions in damages, which there is, how big a chance is that and should Google start to cut their losses now by making the change.
Taken as purely a financial decision, I
Is it Time for Youtube to Reform ?
Reader Comments
(Page 1)2. We had the same problem at Napster, and used the same legal defenses. It didn't work. And Napster didn't host any music files on our servers. YouTube has the infringing content on their servers. Big difference.
Napster didn't accept advertising or subscription revenue because that would have added more furl to the fire of "making money off infringing content". The plan was to wait until after we had a deal with the labels, and then monetize. If YouTube is selling ads now...more trouble.
You are correct that YouTube can't sell targeted ads if they claim to not know what content is on their servers. Ha...it is comical to claim you don't know what is on your own servers.
Further, how can YouTube provide a good search function if they don't know what content is on their servers?
Viacom is moving ahead with their lawsuit against YouTube. Others will follow. The damages, if they win, will be billions and billions of dollars. The penalty for ONE single infringement on one video is $250,000. YouTube does millions of streams a day/month. The fine would be $25 Billion for just 100,000 streams.
Copyright law is tough, and the penalties are outrageously out of line with the actual damage done...but that is the law.
Don Dodge
3. You know this is going to be just as effective as the war on Piracy from the Music industry... We do all remember how that's going right. It hasn't even put a dent in music piracy.
If anything music companies are becoming a thing of the past.
I understand Viacom's need to fight but I think they fail to see the bigger picture. The content really can't be protected in this way. The DMCA defense will hold up in court.
But let's talk Floyd Mayweather vs Ricky Hatton, I got $50,000.oo on Floyd, Mark. I know you had a chance to meet him in person on the dance floor. (which you did an amazing job, making us younger dudes (35) look bad. -my girl now thinks I should be able to take her dancing now.) So what do you say you up for a friendly little wager on the fight. I know 50 thou, probably isn't money to you but that's as high as I can go.
Oh and will you be going to the fight live?
Posted at 7:10PM on Oct 26th 2007 by Mr.Glues
4. Wasn't Youtube purchased recently?
If so, I imagine that the new owner's will change it very soon.
The same happened to Napster.
Posted at 7:12PM on Oct 26th 2007 by Sean
5. Why is it comical to suggest they don't know what they are hosting? Its user generated??
Google has said they don't sell ads based on what the video is, but on how people "search" for videos on YouTube. They don't sell ads based on what it is, they sell ads based on how people search for videos.
Why would they invest time and money on "sniff testing" or "analyzing the content."
The DMCA has made it perfectly clear that it is the content holder's responsibility to enforce their own copyright. Its not Google's job. Unlike Napster, there is quite a bit of actual User Generated Content, and YouTube limits the length of movies to 10 min which is hardly enough to hold a full 30 min television program.
Posted at 7:14PM on Oct 26th 2007 by Tim H
6. They're aleady working on it
http://seattlepi.nwsource.com/business/335594_youtube16.html
Posted at 7:19PM on Oct 26th 2007 by mtgentry
7. It does amaze me though how often traditional media refers to You tube as if they forget that Google is quickly becoming their competition.I guess clips of new shows do help promote them. A good example is King of Queens. Many people I know including myself didn't discover it until 2004 and now watch the reruns. It's also amazing that Yahoo declined buying Google for under 4 million and underestimated the power of search even though they pioneered it. I am a fan of disruptors and it certainly takes one to know one. Complacent industries do often times need new blood to shake things up and drive innovation. Mr. Cuban I am working on two Television shows and am convinced that one of the two will blow you away. If you are as curious as I imagine and would sign an NDA, you will quickly get how dynamic it will soon become.
Posted at 8:40PM on Oct 26th 2007 by rebelforacause
9. Youtube knows it has copyrighted video and they won't do anything because they damn well know that it drives traffic to the site. They want to you believe that its this video "communitiy" with 100% homemade video.
No its not. It is the leading source of video piracy and they KNOW THIS. The site would be vastly different once youtube is forced to remove any copyrighted video. No one will go there because they can't find their anime videos or south park clips. They'll just go to another site with loose rules.
Posted at 8:53PM on Oct 26th 2007 by Leon Westbrook
10. For someone who cashed in on the technology lottery years ago you sure do seem bitter towards those who continue to profit. The one thing we need more of in this world is freedom, and internet outlets like youtube and google video provide a little bit of that. Everytime something comes along for the masses and middle class, people like you are trying to find some angle to profit. Please keep your thoughts and ideas limited to your own companies and give us a break from your envy. No one cares about you and your "take". Its like listening to a doctor discuss what he knows about the brain, NOTHING!
Posted at 10:07PM on Oct 26th 2007 by jeff
12. Congratulations goes out to Mark! Genarlow Wilson was released today. You had a major impact on that situation! THANKS for helping out fellow US citizens! That is AWESOME!
Posted at 1:03AM on Oct 27th 2007 by Scott
13. The problem Google has is that, if they follow your policy, then basically all of YouTube's content gets taken down and there's only a trickle of new content that's allowed back up. That's a sure path to the death of the site. Better to take an only maybe path to disaster than a sure one, I imagine. Besides, it's not clear to me that your solution actually provides a legal defense: my understanding of the safe harbor provisions is that, once Google starts editing for rights, they need to be working with 100% accuracy to avoid lawsuits. That won't be easy; innocent mistakes are bound to happen, and that will translate into substantial awards.
Anyway, if you look at what they're doing, with the special accounts you can get on YouTube now, allowing more uploads, etc., they're essentially creating a copyright-vetted, feature-rich, monetizable first-class area; as more content goes up from these users, it'll be easier and easier to ghettoize the non-vetted content, until the low-end is only good enough for people who want to share their pet videos.
Posted at 3:03AM on Oct 27th 2007 by Wade Armstrong
14. This topic again?
Look it will never happen, plus how is google supposed to know what is a commercial piece of material and what is personal? As far as I know putting a U2 video in a home movie is not illegal, but once you start monetizing around it is when it becomes illegal.
There's simply not enough man power to enforce it and so far the networks haven't stopped it so I really don't see them winning this battle.
Does it suck for the small artist or musician? Maybe. Maybe not. It gives them exposure. What more can they ask for? Does the average person still go on iTunes and buy the same song they saw in crappy quality on youtube? Of course they do. Apple wouldn't be kicking the shit out of the other companies if everyone was just pirating.
Again, trying to shut it down will never work. Maybe some high court eventually agrees with the networks and puts a judgment on youtube. The very next day everyone will move onto another site and anyways... Google has the money to be able to fight for a very long time.
Bryan
Posted at 6:41AM on Oct 27th 2007 by Bryan Hauer | News Blog
15. I was enjoying you on Dancing With the Stars, but it's nice to see you back to what you do best!
Enjoy!
Posted at 6:42AM on Oct 27th 2007 by hellboy726
16. I've never watched a copyrighted video on YouTube. YouTube's popularity is with all of the hilarious user generated videos. If they added a few "mark as copyrighted" buttons next to videos and put up a more threatening warning this would all be fixed.
Posted at 11:44AM on Oct 27th 2007 by pressurewashers
17. The Abyss of content....just like half the refs gambling within the NBA....who you gonna call Ghostbusters?
Posted at 12:58PM on Oct 27th 2007 by Mary
18. Nice conclusion: "Taken as purely a financial decision, I".
Either you need some protein (30 pounds is a lot to lose in a couple of months!) or you have a degree, with honors from the University of "Always Leave Them Wanting More".
Note to Don Dodge: please stop hammering yourself over your Napster past! This is nothing like Napster for one big reason: what is motivating the fear? I'm not saying the fear is valid, but it's certainly understandable. With Napster/Bit Torrent etc., the fear is all around something actually killing sales. Whether it be album sales or DVD sales.
Nobody is worried that YouTube is causing a hit to Boston Legal DVD sales. It's just angst over this notion: "hey, THOSE GOOGLE @^!^@%$ are making advertising money on our 1.5 minute clip from 30 Rock. That ain't right!!"
Should Google be allowed to do that without actually sharing ad revenue with NBC? It is a very, very interesting question. As is: what *exactly* is "Fair Use" in the digital age.
All I know is that when trying to find the clip on YouTube of Alec Baldwin doing impersonations on this past Thursday's episode of 30 Rock I saw this message a lot: This video is no longer available due to a copyright claim by NBC Universal.
But it's still available (and worth the look) at (and in this case Gawker is getting the ad revenue -- is that OK?):
http://gawker.com/news/acting!/did-alec-baldwin-just-finally-win-an-emmy-315536.php?autoplay=true
Posted at 1:33PM on Oct 27th 2007 by Robert Seidman
19. Usually I find Mark's comments on technology and media to be insightful, but in this case I strongly disagree with both the premise and conclusion.
The main flaw in the argument is the assertion that validating copyright would be easy, or even doable. Nevermind hiring and training thousands of people. You'd need to hire and train thousands of people in practically every country in the world. How is some guy in the SF bay area going to check the copyright status of a video from, say, Nairobi, feautring people he doesn't know speaking a language he doesn't understand?
It's just not possible to proactively screen that much content -- at least with any kind of accuracy rate. And, of course, even if you successfully verify that several million videos are legit, the *one* that you miss could cost many millions of dollars in court. And throwing away the DMCA protection suddenly doesn't look so smart when you consider the volume of content on YouTube and what a realistic accuracy rate would be (99.999% would be ruinously bad).
So yeah, YouTube's business model is flawed. Playing in the increasingly insane copyrighted content area is hugely dangerous undertaking. But trying to validate every uploaded video simply isn't possible, *no matter how much money and how many people you throw at it*.
Posted at 3:58PM on Oct 27th 2007 by Brooks
Next 20 Comments
1. I'm not sure whether or not the number of uploaded videos would fall off of a cliff, but I did enjoy the 'cliff-hanger' nature of the end of this blog, is there more?
All that aside: I wonder what percentage of their viewership comes from what percentage of the videos. Meaning, if they're getting 80% of their views from 20% of their videos, then why not hire a smaller 'force' to screen those, and place the advertising there?
I imagine Google/YouTube know within seconds of a clip exploding in popularity, and it could be added to the "Review Now" queue, and if it's infringement free, add it to the "Safe for Advertising" pile.
That way you get the advertising revenue, you minimize the risk of advertising on an infringing piece of work, and you don't have to deal with the cliff.
Right?
Posted at 6:35PM on Oct 26th 2007 by Phil McCarty