Viacom Sues Google Over YouTube for $1 Billion

Snowgen writes "Viacom has filed a $1,000,000,000.00 lawsuit for 'massive intentional copyright infringement' against Google over YouTube video clips. '"YouTube's strategy has been to avoid taking proactive steps to curtail the infringement on its site," Viacom said in a statement. "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.'"

Comments

Whew

[Applekid]

Good thing they pulled all those Viacom clips from Youtube last few months, otherwise they might have been sued for, like, a billion dollars!

Oh, wait.

Re:Whew

[siDDis]

What is Viacom? I can't google it...

Great!

[growse]

Either:

They'll settle, and millions of companies will line up to sue Google.

or....

Google will do an IBM/SCO on their ass and bankrupt them.

Place your bets!

Re:Great!

[taskforce]

Google may be rich, but they are nowhere near big enough to bankrupt Viacom. Viacom has a revenue of over $9.6 Billion USD, whilst Google has $10.6 Billion (according to Wikipedia), but this isn't the case of a smaller firm trying to sue a giant. If anything, Viacom, as a conglomerate, will probably have greater cash reserve and certainly has more assets which can be sold off in the event of it needing more cash.

Re:Great!

[Otter Escaping North]

Either:
They'll settle, and millions of companies will line up to sue Google.
or....
Google will do an IBM/SCO on their ass and bankrupt them.

Missing option. ;>

This is a negotiation tactic being used to drive licensing talks that are going on behind the scene. My money's on that one.

Re:Great!

[drooling-dog]

Viacom, like other media companies, is mostly worried about two things: (1) losing control of the distribution of their product, and (2) losing control of distribution, period. The first concern is legitimate, but can easily be remedied by Google simply by not allowing Viacom's property to be posted to the site. The second concern has more to do with the fear of the rise of competitive distribution channels, and that exists even if these channels don't deal in copyrighted material. There is a finite pie of ear- and eyeball-hours out there, and if 30% of them are ever drawn to Creative Commons type stuff, that's 30% that isn't paying Viacom.

Austin Powers

[omega9]

Why ask for one BILLION dollars, when you can ask for ONE MILLION DOLLARS?!?! MUHAHAHAHAhahahaha...ha..aha..*ahem*.

Why stop there?

[Hoi Polloi]

They should go for a zillion-gabillion dollars!

Lawsuits should always be based on nice round numbers, not actual proven damages.

looks good on them!

[boxlight]

I'll probably get modded down for this, but I don't think it's right that Google is allowed to generate all that eyeball-driven advertising revenue by broadcasting other people's copyrighted video content.

I like free video as much as the next guy, but people *own* this stuff. And Google does not.

The billion dollar lawsuit looks good on them.

Re:looks good on them!

[drooling-dog]

You're right, of course, but sites like YouTube are a huge threat to the Big Media cartel regardless of whether they traffic in copyrighted material. A major barrier to entry in that industry is access to distribution channels: theaters, television and radio airtime, etc. It's like supermarket shelf space. That's why indy musicians and film producers have had such a hard time winning eyeballs regardless of the quality of their stuff. YouTube and sites like it bypass the gatekeepers and short-circuit the whole system; now just about anyone can reach the mass public if their creations catch a wave. Just as in the music industry, that scares the bejesus out of companies like Viacom because it strikes at the core of their business model.

It wouldn't surprise me a bit if Viacom indirectly had people posting copyrighted material to YouTube as fast as Google can take it down. They need to attack the channel regardless, and to do that successfully they need a copyright case.

Viacom Demands YouTube Return Viewers

[twitter]

Once again, life imitates parody. I did not know they were worth a billion dollars.

Hmmm...

[richdun]

(as of about the time I posted this)

Google's market cap: $139.97 billion

Viacom's market cap: $27.61 billion
CBS' market cap: $24.38 billion (sorta kinda relevent here)

I think it's just a little market cap envy. Next stop: Google buys Viacom?

Please:

[Anonymous Coward]

Google, please drop all Viacom sites from google.com. After all, they hate all the free publicity and promotion you give them.

Re:Please:

[ePhil_One]

Google, please drop all Viacom sites from google.com.

Yes, Google should hold Viacom sites hostage until they give up their legal rights. I for one welcome our new Google overlords.

Re:Please:

[ergo98]

Google, please drop all Viacom sites from google.com. After all, they hate all the free publicity and promotion you give them.

"Free" publicity?

More accurately, people go to Google to search for stuff like Viacom shows. If Google were ever dumb enough (they aren't) to start self-censoring to penalize foes in other areas of their business, people wouldn't use Google. Google would be shooting themselves in the face to spite a pimple.

And it isn't like this is unexpected. When YouTube was being woo'd, Mark Cuban was widely quoted for saying "Only a moron would buy YouTube" (because of the huge potential lawsuit liability). Maybe a better statement would be "only a non-moron that has the cash to pay off the inevitable lawsuits", of which there are only a few companies, Google being one of them.

Re:Please:

[russ1337]

>>> "Google would be shooting themselves in the face to spite a pimple".

In this case, Google would be shooting themselves in the face to spite a large cancerous growth.

Re:Please:

[walt-sjc]

This move by Viacom is just a negotiating tactic, much like Cisco's against Apple over the iPhone name. Nothing to see here... Move Along...

Re:Please:

[walt-sjc]

The dollar amount means NOTHING. They could have said $50,000,000 or $500,000,000,000 - the end result will be exactly the same, which will probably be that Google and Viacom will come to an agreement that google will do more to keep individuals from posting Viacom's crap, and Viacom gets to upload their crap to YouTube and stick advertising in it or offer it for sale (ala iTMS).

Re:Please:

[julesh]

Tit for tat retribution really only works on the playground. And maybe in international spy rings.

Not to mention the Iterated Prisoners' Dilema.

Re:Please:

[Atlantis-Rising]

Think of it from Google's point of view. How does that help them? Google is helped by having the best, fastest, most effective search engine around. That's why people come to them, and that's why google gets ad revenue.

Fucking with the rankings does nobody any good.

Re:Please:

[magarity]

what if Google instead just demoted Viacom links a little in the search results
 
Don't bother. Just buy Viacom and stop suing themselves. Problem solved.

Re:Please:

[ergo98]

Nope, "people go to Google to search for stuff like" "shows". For Viacom's shows, Google is one way, the easy way, to find them. Without Google there would still be a way, the good old harder way, to find them.

You mean using one of the countless other search engines?

Google's biggest asset is the quality of their search. If Google compromised that (e.g. paid placements in results, or removing a set of results just to penalize someone), people would stop using Google, and would instead use one of the many other search engines (many of which are neck and neck with Google results wise).

Google has next to no search-engine-ranking muscle to flex. Given that most are fervently against paid search placement, it's astounding that so many are so quick to support what is in essence "conform-for-placement" just because it serves their agenda.

Re:Please:

[CommunistHamster]

Or, perhaps:

"You searched for Viacom. No results were found. Did you mean Torrentspy?"

Re:Chuckle

[growse]

Not wanting to defent Viacom, but I'm sure they'll be fairly keen to point out that they actually pay their staff...

If I were Google, I might just pay it.

[xxxJonBoyxxx]

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.

Google: "No shit. Here's your billion, we've got a couple more to spare. Muh-huh-huh-ha."

Just numbers relevant to "IBM/SCO on their ass"

[mapkinase]

GOOG: Mkt Cap: 139.97B
VIA: Mkt Cap: 27.71B

IBM: Mkt Cap: 141.50B
SCOX: Mkt Cap: 21.23M

Re:Just numbers relevant to "IBM/SCO on their ass"

[Alioth]

The difference between Google and IBM is IBM is really worth its market cap, but Google's market cap is a hyperinflated bubble.

Re:Just numbers relevant to "IBM/SCO on their ass"

[dextromulous]

Furlongs between corporate headquarters?

Re:Just numbers relevant to "IBM/SCO on their ass"

[aztec rain god]

23,528 furlongs (from google maps)

Here's the PDF of the actual complaint ...

[xmas2003]

US District Court Filing

Re:I predicted this a while ago

[Kelbear]

Yeah, it seems like many other people shared this view when the news of Google buying Youtube came out.

Youtube was popular but not really making any money.

Google buys them, and Google has money.

Now it's Youtube, but with money to sue them for. Google buying them just upped the risk factor considerably. Google has quite a few brainy folks on their side, I'm sure they saw the lawsuits coming. So I'm wondering, what's the plan they have in store for this contingency, because there's no way they would've gone into this without a plan...right?

Please?

What the

[tehwebguy]

Don't Viacom know that their precious DMCA protects Google?

Re:What the

[91degrees]

Probably. And it appears to have been part of the intent of the DMCA. However the act was pretty badly drafted, and part of it does depend on whether Google is directly profitting from the infringement.

Of course, in Youtube's favour, is the fact that the service clearly isn't intended as a vehicle for copyright infringement. Most of the material there is actually the home video stuff that the site is intended for, and they are making efforts to remove the material immediately.

Re:What the

[russotto]

The DMCA is badly drafted because the companies which wanted it -- content providers like Viacom -- deliberately had their lobbyists draft it that way. They expected to use the power of their corporate takedown-letter-writing department to shut down anything they didn't like. They didn't count on a service provider with the capacity to not only host enough content to give their takedown-letter department writer's cramp, but to actually be able to handle all those takedown letters without shutting down.

Common carrier

[Anon-Admin]

(IANAL) I look at this and wonder is google will use the common carrier clause. By not monitoring and policing the content of the users they could well fall under the common carrier clause. This would mean that as a common carrier, they are not responsible for the content that is on there network. The end users would be responsible.

I have worked at and run many ISP's, The lawyers ALWAYS insistent that any news feed be uncensored because the act of censoring or deleting any of the content could be used in court to show that we agreed with the content that remained. Thus we could be sewed for any illegal content that we missed.

Just my .02c worth

old media logic

[circletimessquare]

old media fails it

when linking to content, hosting content, etc., you generate buzz, hits, pr, etc.

in other words, the more content you get out there, the cheaper you get it out there (hint: free), the more money you make: more traffic, more ad revenue, more awareness

this is the future, and old media doesn't get it. by putting traffic stops at the doors to their content, by micromanaging who seems what and when, you don't preserve your revenue streams, you kill them by making getting to them too obscure and/ or difficult

the guys who grew up on radio and television as their model just. don't. get. it.

Understandable.

[Erwos]

I can understand Viacom's position here, and I don't think it's totally unjustified. That's not the same as "I totally agree with it", mind you, but I see where they're coming from. Google is using their copyrighted works to make money, and doing so without permission. Did said works get uploaded by others? Yes - but does this somehow absolve Google of wrong-doing?

I think that last question is what's going to need to be answered legislatively and judicially over the next decade. It seems wrong that Google is profiting off Viacom's work without permission or license, yet more restrictions will hinder the development of some technologies (ala some of the proposed remedies to mass copyright infringement via P2P). This, of course, assumes there is not some sort of drastic change in how copyright is handled - which I'm sure is the solution many Slashdotters would prefer, but doesn't strike me as terribly likely in the current legislative climate.

Re:Understandable.

[smellsofbikes]

When I send mix CD's full of copyrighted material via USPS to my friends, USPS is using those copyrighted works to make money and doing so without permission. Does that absolve the USPS of wrong-doing?

Spoiling for a fight

[Spazmania]

Google has been spoiling for a fight over the DMCA safe-harbor provisions for some time now. Their book search and regular search business depends heavily on that part of the DMCA's enforceability. Without it, the Prodigy and Napster decisions could be used to annihilate Google and every other modern search engine.

Its far better for Google to explore the ramifications via a subsidiary company that can be cut loose to die if need be.

Re:Spoiling for a fight

[amper]

This was actually discussed quite a bit here on Slashdot back when the Google buyout was announced. The general feeling was that because much of Google's business model and future plans depends so heavily on the eventually outcome of the inevitable lawsuits that sites like YouTube are going to generate, that Google needed to buy YouTube just so they could be a party to those lawsuits, and use their considerable legal and financial resources to try to ensure that they get a favorable ruling.

Re:Spoiling for a fight

[Znork]

"and use their considerable legal and financial resources to try to ensure that they get a favorable ruling."

I doubt there's any point to that; the courts basically cannot resolve this issue in any useful way within the current legal framework. The idea of handing out monopolies might have been useful when the point was to keep the kings friends rich and happy and the content controlled, but they simply cannot be reconciled with a free market economy and todays rate of technological and content evolution. As long as the system is tied to monopoly rights you only have the choice of who you're going to allow to screw everyone else (which fundamentally means, the more 'IP' we have, the more all of us are going to get screwed (and in slightly more economical terms, the more waste we'll get in the system due to monopoly inefficiency)).

It would be more useful to engage in actively trying to fundamentally restructure the 'IP' incentive system to a fundamentally non-confrontational incentive system. Look over the foundation.

Some say we need an incentive to be creative. While I personally disagree to a fair extent (and things like free software indicates otherwise), ok, I'll buy that maybe some people do need an incentive, and that some creative talent could be more creatively productive if they had a certain economic security. As the point of an intellectual incentive system would be to maximize creativity, that leads to the conclusion that we somehow may need to finance creativity beyond what a fully competetive market would do. So, say, a popular creative work of value to many people should conceivably generate enough revenue for the creator/participants to live off for a certain time (too short would be bad and an insufficient incentive, too long and there would be no (again, claimed) economic incentive to create further works (and spend too much on a single creative work, and you get fewer works for total economic resources spent instead).

So, how do we determine what works merit incentive? Let the free market handle it; works that get copied the most, ie, are most highly desired should probably be the first to receive incentives (until their useful payout is exceeded, the authors et. al die, etc, and the incentive no longer serves the creative purpose). As there would be no right to prevent copying anymore, there would be no particular reason to avoid reporting the numbers of copies being made, ie, it would free up anything from p2p networks through youtube, IPTV broadcasters, network radio broadcasters, etc, to record popularity of works and lay the foundation of who gets paid.

Then the final question becomes, how does one finance the system? First, realize that the current system is essentially a tax. The costs to the economy are very real and altho the copyright holders have a strong incentive to shut up about the actual costs to the economy, the billions they collect are as real as the billions the IRS collect. The difference is, with the billions the IRS collect, there's actually some theoretical and nominal responsibility and accounting of the costs to the economy and what they're used for.

As responsibility, accounting and some form of democratic control over incentive systems is generally regarded as a good thing, I'd say moving the collection of revenue and responsibility for the system over to the state agencies usually responsible for such things to be fairly reasonable. So where in the economy would it be most equitable to collect the funding? Personally, I'd say, where the money's made. IE, slap a tax on youtube ad revenue. Slap a tax on movie theatres. Slap a tax on IPTV revenues. In fact, slap a tax right over anyone who makes money off selling, distributing, or performing the works in question. As the works being played is recorded and accounted for (something which is already done in most cases), the funds gathered from display of that work will primarily be going to the creators of the work, making sure the incentive generated is both as equitably gathered and a

supply and demand

[chinard]

its all about availability of content.

Viacom is doing NOTHING to make this content as available as it has become in youtube.
Maybe if they did, and put in their own advertising, they'd be making the ad dollars off this content instead of loosing it to youtube.

You want a cookie?

[Lanoitarus]

Look, im sorry- I really don't mean to flamebait here. In fact, I really ought to post this as AC just to avoid the karma dock. But Im not going to. Are you really patting yourself on the back for predicting that someone would sue google 6 months ago? Did you miss the hundreds of other analysts, newspapers, and critics that said the same thing? Did you miss how the one of the biggest aspects of the merger being talked about by wall street was the escrow account for copyright issues?

So congratulations, you predicted that google would get sued over YouTube. With insight like that, maybe you could get a job forecasting the weather in LA (today: sunny. tomorrow: sunny...). Or maybe you just wanted to shamelessly link your blog.

Anyway, if anyone needs me, ill be over in the corner modded down to -infinity, flamebait. But at least I wont be claiming to be a genius for predicting that the sun will rise tomorrow morning (REALLY! ITS TRUE, WAIT AND SEE!).

Re:All new...

[mgblst]

Wow, you should really change your argument to Mr Really Extreme guy. You sure have a way of presenting arguments in a balanced light, by present both cases in the most extreme possible. "So you either hate all children, and want them all tortured to death, or you love them and want the best for them, which is it?"

not a single clip was even slightly shady
 
Besides in your inane ramblings, where have you ever seen this before. Media companies have always wanted clips they consider their propery removed from youtube, and made a number of requests to do so, long before Youtube was bought by Google.

every clip that's ever been shown is worthy of at least one lawsuit!
 
And once again, who has ever said this? Nobody. Viacom want to be compensated for there clips making youtube money, which is what they do. Every clip shown makes google money.

This is a law suit that has been spoiling to happen for a while now, and I think both concerned parties have prepared for this.

Has anyone else noticed...

[realinvalidname]

...the entertainment industry's lawsuits are way more interesting than their TV shows, movies, and records? Maybe they should formally change their business model and go primarily into lawsuits as a creative medium.

Thank you for that

[iceperson]

I really appreciate you coming down from your clearly enlightened high horse long enough to type that up...

Re:I predicted this a while ago

[squiggleslash]

The other difference is that I don't think anyone seriously believes that Napster's "library" was mostly original work, authorized (and uploaded) by the copyright holders, with the majority of Napster's users going to it for access to that type of content. Oh sure, some of it was, but the vast majority...

YouTube, by comparison, seems to be mostly original work, created and posted by the copyright holders to those works, they publish. As a tool, it's clearly aimed at legitimate uses, and Viacom's one legitimate complaint might be (MIGHT be) that Google just didn't police it well enough.

YouTube has much more chance of landing a Betamax-type verdict than Napster did. I'm not saying it's cut and dried, but I'd be surprised if they can't at least deflect the bulk of the liability to their (copyright infringing) users, which is arguably as it should be. $1 billion dollars? IANAL, but I just don't see it.

Re:I predicted this a while ago

[jfengel]

I'm not saying that Google is some paragon of virtue, but they have money and lawyers.

Now all they need is guns. It would be much more fun and would earn the Warren Zevon seal of approval.

Re:Yeah, big surprise

[Irish_Samurai]

They were expecting this EXACT thing to happen. Google wants to pick this fight. Let's look at the history.

1. Google Hires a well, known lobbyist firm to represent them.
2. Google Buys YouTube even though everyone under the sun knows that makes them a target for litigation.

Why would they do it? Because this case will dictate and set precedent for the future of this business model. Google was already going in the direction of online video, but YouTube had a better userbase. Google couldn't afford to let YouTube to get sued into oblivion by some huge multinational media giant. It was in Google's best interest to buy the company and fight this fight with their resources instead of letting an underfunded (relatively) startup set the precedent.

Now, can they pull it off?

Re:Yeah, big surprise

[Bobby Mahoney]

A cloaked sith lord sits in an ominous rotating chair aboard the google-star, as he reads the law suit: "Excellent, everything is going precisely as planned. Ready my ship commander."

Re:Chuckle

[Dachannien]

I'm sure nobody at Google works for free either. But Viacom wants Google to do its dirty work for free: examining video clips, digging up the relevant copyright information, contacting the owner of the copyright to determine whether it should be posted to YouTube or not, and removing the offending clips.

Remember that while each media corporation is under the misguided assumption that they are the only folks who own the copyright on content, in truth, there are lots of clips on Google/YouTube that the copyright owner has posted legitimately, and many more clips where the copyright owner is unknown or cannot be located. Viacom wants to shift the burden of filling out DMCA takedown requests to Google, despite the fact that Congress (miraculously) realized that a hosting provider should not be responsible for vetting every piece of content that a user posts to their service.

Viacom is in a far better position to take care of everything that comes before the deletion of actual infringing content. They are aware of what material they own the copyright to, they already know who owns the copyright on that material, and they already know that they don't want it on YouTube. They also have a legal remedy - a DMCA takedown notice - for having such material removed.

If Google has to vet all of its content to make sure that Viacom doesn't hold the copyright, then they can't just stop with Viacom's content. They can't even stop with every ??AA member company's content. No, they have to establish the wishes of the copyright owner for every single piece of material on their site. And if Google loses, then every website that provides hosting space and shows advertising alongside it - Angelfire? Geocities? - has to do the same thing.

That's why the DMCA requires takedown notices, that's why it absolves hosting providers of responsibility for vetting material that their users post to their services, and that's why Google is in the clear and Viacom will be ponying up their legal fees in a few years' time.

Hostage?

[Anonymous Coward]

I wouldn't call it "hostage" because Google has absolutely no obligation to Viacom to provide them with search engine service.

Personally, what *I* would be tempted to do would be to block anyone in Viacom's IP block from accessing Google at all. I'd say to do the same for YouTube, but they'd probably claim that was just to cover up the infringement, so it might be a bad idea.

I mean, exactly what does Google owe Viacom, anyhow? They aren't the ones putting up these clips--users are. And Google has what might be the one good part of the DMCA on its side--the Safe Harbor provisions. If anyone has a duty to police Viacom's "property" it should be Viacom.

I, for one, am sick of copyright holders trying to push responsibility onto everyone but themselves via technology and legislation. They want to, in effect, carpet the kingdom because they don't feel they should have to wear shoes.