Viacom “Austin Powers” to Google: We want ONE BILLION DOLLARS!

Viacom has sued Google/YouTube for copyright infringement, filing papers today and asking for a billion bucks in damages. The Viacom Press release summarizes their point of view. In short Viacom says of YouTube:

Their business model, which is based on building traffic and selling advertising off of unlicensed content, is clearly illegal and is in obvious conflict with copyright laws.

Here’s the Reuters Story

Mark Cuban warned about this type of legal challenge overwhelming the YouTube deal several months ago.  Here’s his take on the latest news.   It seems possible Google may wind up regretting their purchase of YouTube, proving to be a hornets nest of potential litigation that seems to be increasingly expensive. This while it remains unclear how well YouTube content can be monetized, to the extent there is much left after all this litigation. Google allocated about 400 million of the 1.65 billion purchase price to settle these claims but if the Viacom lawsuit it any indication it may get more expensive than that.

Ultimately I’m guessing it’ll be judges reaction to the new ethos surrounding IP law. Onliners big and small routinely disregard many longstanding content distribution rules so judges may decide that the legal issues have become so universally murky that they’ll start ruling in favor of the new media distributors like YouTube/Google, though I’m guessing the first sets of judgements will seek to penalize them in the name of respecting existing copyright laws. The swirl of legal challenges to YouTube content may be a case where Google’s freewheeling, usually innovative approaches come back to bite them, but it’s too early to know.

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