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.
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.
Don’t miss the Discovery Channel’s fascinating inside look into the history and construction of the Three Gorges Dam project on China’s Yangze River. This massive project is the largest public works project in human history. It will create a 400 mile long reservoir so massive that it may actually affect (very slightly but measurably) the rotation of the earth. Three Gorges Dam is displacing over a million Chinese who live upriver from the Dam, though it appears that in many cases they’ll be relocated to better housing at higher ground. 36,000 square miles will be inundated as the river above the dam slowly rises. Although some measures are being taken to preserve historical monuments an incalculable degree of historical and human emotional treasure will be lost from this dam.
The Mega Dam special gives some incredible insider looks into the control rooms of the power generation and shipping lock facilities as well as a brief look at some of the computer controls, which appear to have very intuitive graphic interfaces.
A critic quoted in the film suggested that the benefits of the dam are effectively shipped off to big cities and larger farmers at the expense of the million plus Chinese who are getting displaced. However other aspects of the story do not seem to support this vision because it appears that the relocated cities are generally of higher quality than those they are replacing. One advocate suggested that this would be hard on the old relocated folks, but for the children the relocation would bring better health, education, and opportunity.
Viacom’s ditching YouTube, and says they are glad they did. This FT story suggests that we may seeing the beginning of what could become a monumental shift in content distribution online. Viacom has forced YouTube to delete Comedy Central and other popular clips, and says these deletions have resulted in people heading over to the Comedy Central website to find the content rather than YouTube. This was exactly what Viacom wanted.
Key questions are shaking out about online video:
*How much of the video traffic is to the “professional” content like that produced by Viacom vs amateur content?
* How important are search engines / major video sites to finding clips? The Viacom statement suggests that people will seek the clips they want away from YouTube. However if they are using Google search to find the alternative locations of the clips Google may have successfully covered both these bases with the YouTube aquisition.
* The most important question is about $money$ and it is simply this – can video be monetized well? Nobody knows yet. I predict the answer is going to be somewhat complex, but basically no, you can’t monetize it nearly as well as pay per click advertising, where the information experience can be integrated well with the buying experience. With Video this match is going to be more difficult and usually impossible. Somebody watching a “Daily Show” clip is primarily interested in a quick laugh, and seems unlikely to wind up clicking off on an advertisement and almost totally unlikely to buy something as part of the Comedy Central clip watching experience.
Sure there will be some room to market clip specific advertising like Comedy Central hats, but that type of thing is not much of a market for the burgeoning video content industry. Even junky clips take a lot more time to produce and and bandwidth to distribute than text content, so the revenue equation is simply not as favorable and probably will always be a challenge.
I think a major challenge with Video is that many think the online video experience and advertising will be similar to Television content and monetizing. It won’t. Decentralized control and the fact almost anybody can and will produce content are changing things rapidly and globally.
The video fun, junky content, and advertising experiments have only just begun.
Blinkx is a brilliant video search program that allows people to search *within* videos for specific content. This has become one of the holy grails of search because the internet is now awash in video content. Tastes vary but almost everyone would agree that most of the clips out there are garbage. With routines like Blinkx users can rapidly search the tidal wave of video that pours online every day for things that interest them.
Check out the Blinkx home page with it’s “wall” of tiny video clips reflecting content they have recently indexed. It’ll keep the attention of even the most stubborn A.D.D. sufferer. Some cringe at the sensory overload of dozens of videos, but massive input reflects the new ethos of the internet, and I predict we’ll see desktops and applications become increasingly overwhelmed with content. As a superb tool that will manage the most rapidly growing and complex part of the digital maelstrom – video clips – Blinkx has a rosy future indeed.
Wow, when Steve Jobs suggested music producers effectively getting rid of Digital Rights Management in his post “Thoughts on Music“, a few people were interested in that. Since blogging may determine the outcome of the coming presidential election, I recommend Jobs run for US President on the “A chicken in every pot and free music in every pod” platform.
My first reaction is that internet people tend to talk too much about music news, but DRM is a very significant topic both in terms of the impact on the industry in terms of money and innovation and perhaps will have broader influence in the coming debates about who owns what and why. So, squawk on dudes!
I think Mark Cuban has more valid points than Cory does on the controversies swirling around copyright and takedown notices delivered by Viacom. Cory is right that it’s annoying and obnoxious to send takedowns to people who obviously are not infringing, but that’ll shake out soon enough. What isn’t shaking out soon enough is what I’ve discussed at length before – YouTube and Myspace and other big players are making hundreds of millions by purposing user generated content to their commercial needs. I’d even concede that commercialism is not the bottom line on these big player/user interactions, and also concede that users like me are agreeing to provide content that in turn gets searched at Google and generates money for them and *sometimes* for me.
However as Mark correctly notes it’s significant to ask within the copyright, content, and user community issue this question: Who gets the lion’s share of the revenues created by copyright holders or community participants? I’d like to see more of that cash flow to the community and less to the big players. But maybe that’s just because I’m a community guy?
I simply don’t know if this lawsuit against Google, SONY, and other big players suggesting a previous right to digital distrubition has merit or not because I don’t understand the legal issues well.
However it’s another good example of a tactic increasingly used by tech firms that are not doing very well with their technologies – work the legal angles hoping to hit a big payday via settlement with a deep pocket like Google or even hit a home run with a court decision in their favor.
I’m not objecting to these lawsuits though – I think the big players have tended to give great liberties with content distribution and have taken great liberties as well. Youtube’s empire was built largely via illegal content distribution. These complex deals with gigantic stakes probably should be settled by objective legal means.
When you are raking in billions it’s easy to be generous and I predict that the real “tipping point” for Google’s fall from grace will be the shift from them getting sued to them suing other firms, especially small ones. Maybe they won’t have to sue which would bode very well for Google’s long term prospects and claim to the high ground.
Alek informs me that he really is up to amazing X10 cam tricks with lights and inflating Homers despite the fact that it was a hoax back in 2002. It really is amazing then.
REVISED: Alek Komarnitsky has (not!?) set up a remarkable use of remote online control at his house for Halloween, with 3 webcams, light switches, and inflatables controlled by the viewers. Amazing. NOT Amazing.