The blogosphere is in a tizzy today over this Financial Times piece that claims Google, YouTube’s soon-to-be parent company, is in “frantic” talks with all the powerful entertainment companies to avert a “potentially crippling round of lawsuits.” The article contends that CEO Eric Schmidt and other Google executives are offering “tens of millions” of dollars in upfront money to appease CBS, Viacom, Time Warner, NBC Universal and News Corp., among others.
Puhleeeease….first of all, as we’ve already established, YouTube only has to respond to take-down requests to avoid big and expensive copyright infringement lawsuits. It’s true that all of these media giants could sue without first requesting take-downs of their content, but how far could those suits get? Google/YouTube merely has to point out that these suits were filed prematurely, i.e. that the media companies didn’t bother, couldn’t lift a finger even, to follow the statutorily established remedy spelled out in the Digital Millennium Copyright Act.
Unless the media companies could establish that Google/YouTube had prior knowledge of the infringing videos, what judge in his right mind would allow these kinds of lawsuits to proceed? Like anybody else, federal court judges are overworked and don’t want to have to deal with conflicts that could otherwise be remedied, and, in this case, easily remedied. Google probably already knows that any infringement lawsuits filed by parties that didn’t even bother to request take-downs will get dismissed lickety-split.
More than likely, Google isn’t “frantic” but is being aggressive in trying to land content deals that take YouTube to the next level. That’s what they should be doing…YouTube can grow only so big and make only so much money with videos of cats chasing their tails or charming old British men telling their life stories. It’s just far more exciting to think of these talks as “frantic” attempts by a big powerful company to keep its headline-grabbing, $1.65 billion acquisition from going down the drain.
Update: Viacom is purportedly one of the companies Google is talking with, discussions that follow on the heels of Viacom’s request that YouTube take down clips from its Comedy Central “The Daily Show with Jon Stewart” and “The Colbert Report” shows. This related video clip from “The Colbert Report,” which is still on YouTube (oh, the irony) is not to be missed.
Posted by Cynthia Brumfield at 1:26 PM | Print | Comments (0)
The Mercury News has this piece on Fox Interactive, the 18 month-old Internet and interactive media arm of News Corp., which suggests that after a stellar beginning, reality is setting in at the hot company.
First, COO Mark Jung, who came on board with News Corp.’s purchase of IGN Entertainment, is leaving, with CEO Ross Levinsohn taking over Jung’s duties. Secondly, Fox Interactive’s highest profile property, MySpace, is experiencing cooling growth.
But, as Levinsohn points out, it’s not possible for any business to grow at the rate of 60 million new users every few years. MySpace, however, has room to grow internationally — its UK site now has six million users after only a few months.
More acquisitions could be in the cards to keep Fox Interactive’s momentum going. One deal that slipped away from News Corp. is YouTube, a lost opportunity that still clearly rankles Levinsohn.
“I don’t think we would have spent $1.6 billion to acquire YouTube,” he said. But, he added, “If you’re going to run a (sale) process of one of the hottest companies on the Internet, you should do that openly. There’s no advantage to shareholders to do these things in private. You don’t necessarily get the best value in the market. If it were out being shopped, maybe it could have sold for $2 billion.”Posted by Cynthia Brumfield at 11:59 AM | Print | Comments (0)
The Washington Post’s Paul Farhi has this article today which basically reiterates the by-now well-known political phenomenon of posting embarassing candidate videos on YouTube and other Internet video sharing sites. But Farhi does put some new perspective on this trend, noting that despite the role of online videos in exposing the worst sides of candidates, TV still reigns in its reach.
Even so, political professionals say online video isn’t a substitute for traditional forms of communication, such as advertising and news coverage. The difference is sheer numbers: A 30-second TV spot for a candidate can reach hundreds of thousands of would-be voters at once, as can a newspaper story or an evening news report.
But, unlike TV, Internet video doesn’t come and go — it just hangs around for folks to view at any time. And, getting a video on YouTube is almost instantaneous, unlike before the rise of Internet video when a campaign might take precious make-or-break days to get damaging footage into a TV ad.
What’s changed, too, is the speed with which the public can view this kind of footage. When Burns [Senator Conrad Burns, R-MT] commented during his 2000 reelection campaign that some Montanans were without health care coverage because they “choose not to be insured,” his opponent, Brian Schweitzer, used the comment in a TV ad that aired three days later. Nowadays, such video likely would be posted in a few hours.Posted by Cynthia Brumfield at 11:16 AM | Print | Comments (0)
The Wall Street Journal has this piece today about the frustration YouTube is experiencing when it attempts to clear the rights to any piece of video or music on its site. Despite YouTube’s deals with a trio of top record companies, it hasn’t landed the rights to every component in those companies’ songs and videos.
Why? Because the record companies hold only some rights to the music and videos that fall under the YouTube contracts. For example, the record companies don’t address the royalties for the music publishers, the people who own the copyrights to the written music underlying the songs.
When it comes to videos, the number of parties that hold rights in the content increase dramatically — actors, directors, writers, studios and so forth.
In other words, YouTube is experiencing the exact same transactional headaches that the radio station and cable industries bumped up against in their early days.
“It’s such a mess because the [entertainment companies] have all of these valuable assets that are just locked up with so many people who need to sign off on them,” says YouTube Chief Executive Chad Hurley. “I don’t know what it requires, if the government needs to be involved,” Mr. Hurley laughs. “I don’t know.”
Hurley may think he’s joking when he suggests the government needs to step in, but in fact the government has intervened before in exactly this kind of situation. Both radio stations and cable systems, as well as DBS providers, for example, enjoy what are called “compulsory licenses” that enable them to use copyrighted works without permission so long as they pay according to fixed schedules into royalty pools, the funds from which are redistributed to the copyright owners.
All of these compulsory licenses were established by acts of Congress, as well as, in some cases, international treaties, and payments are mostly managed by government entitites, the U.S. Copyright Office, for example (radio stations pay rights organizations ASCAP and BMI under an additional regime that is not quite a compulsory license).
The reason these licenses exist is because of “market failure,” namely because there are too many copyright owners to deal with — the transactional costs are so high that if the compulsory license didn’t exist, cable operators couldn’t retransmit local or distant TV stations, radio stations couldn’t play music or jukeboxes might not even exist.
Hurley’s problems in tracking down rights owners and negotiating agreements with them is exactly the kind of situation a compulsory license is intended to address. While the notion has been floated that compulsory licenses should be created for P2P sharing, I haven’t seen anything that suggests compulsory licenses might be needed for online video or music used in user-generated content. But that’s an intriguing idea…
Posted by Cynthia Brumfield at 9:19 AM | Print | Comments (1)
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