Why Google Wanted a YouTube Lawsuit

An anonymous reader writes "After YouTube was purchased for $1.6 Billion, there was rampant speculation that Google would soon be waist-deep in billion dollar lawsuits. Despite the enormous liability issues, Google purchased YouTube for a mind-numbing sum, leaving many doubters wondering if Google considered all of costs involved. A theory has been put forth explaining what Google may have been thinking when it bought the company." From the article "Letting YouTube fight this battle alone with their own lawyers might have resulted in a very public and unnecessary loss that would have crippled Google's video ambitions and possibly caused collateral damage to a bunch of related industries (especially search)." In short, the author argues that Google had a lot more to lose had it kept away from YouTube and let the old-media companies crush it with lawsuits."

Comments

Sad that money means so much in the courtroom

[Reverse Gear]

The sad thing about this is that it actually does make sense that Google should buy Youtube for the reason stated in the OP.

It is really sad how the interpretation has become a matter of who can afford the most lawyers and things like that. I think this is a trend that is seen at it's strongest in the USA but we sure also see this here in Europe and Denmark where I live.
In my simple mind the law should be equal for everyone no matter how much money they have, but that really is being naive these days as far as I can figure.

I don't know if my thinking here is to much influenced by movies like Civil Action, but then again it claims to be based on a true story (and the movie is almost 10 years old, so I guess this isn't a new trend, at least in the US).

Re:Sad that money means so much in the courtroom

[sarathmenon]

The good thing is that google is waging the war against the mafiaa rather than you and me. File sharing and DCMA are totally different things, but I'll welcome any adversary against the *AA. If they are clipped off from both sides (content and consumers) some good might come out of it.

Face it, google is the best corporation to take this law suit along, much better than say Apple or Microsoft. I agree they aren't perfect, but for all the things that they do, they simply are one of the better choices.

Re:Sad that money means so much in the courtroom

[jforest1]

2 letters: O.J.

--josh

Re:Sad that money means so much in the courtroom

[hey!]

Sad it may be, but it is ievitable that money matters in a civil lawsuit. As long as people are allowed to sue to recover just damages, others will be tempted to sue to obtain unjust settlments.

When things come to trial, if our laws are at least reasonably just, then justice has better than even chance. The real problem is the majority of times when things don't come to trial, when defendants pay the plaintiffs to go away; when freedoms are quietly forgone; those are the times that justice is threatened most.

The legal profession should police itself better. It is unethical to use the fear of having to mount a defense to extort money or concessions from people. There is no moral difference between that and using threats of physical force.

Lawyers who are party to legal muggings should be disbarred.

Re:Sad that money means so much in the courtroom

[billcopc]

Not true... O.J. won because anyone else would have done the same damned thing! What... you thought he'd waltz into court and proclaim "Yeah, I killed that cheating bitch and her dildo friend too!"... hellllll no. Homicidal weirdos do that, something O.J. is arguably not.

Money matters in court when that money controls the law. Actors do not control the law. Politicians control the law. Religion controls the law. CEOs of multinational megacorporations control the law. All the other wealthy but non-influential people don't get preferential treatment in court. It doesn't matter whether you have an average-priced experienced lawyer, or a flashy whiz-bang zillion dollar court jester lawyer, as long as you don't have an idiot lawyer you're still in the fight.

Bad deal

[javilon]

By this interpretation, Google could have waited for the lawsuits to start and then buy YouTube for very little money, they could have saved a Billion.

Re:Bad deal

[Samuel Dravis]

But then, you see, the other companies would have already won in court, which sets precedent for all video services. Google bought YT to prevent this from occurring.

Re:Bad deal

[Don_dumb]

Yes. Another day, another person who does not have any actual inside information into Google, attempts to guess why they are too brilliant to not have made a mistake buying Youtube.

Big companies CAN make mistakes, I dont know if Google has or not and I have no less insight into Google than anyone else here.

Re:Bad deal

[91degrees]

This isn't "fair use". The videos that Viacom has a problem with (at least most of them) are infriging Viocom's copyright. Distributing an entire commercial production is not fair use. What Google want is a ruling that they are not liable for the infringement.

Re:Bad deal

[pla]

but I don't think what Google/YouTube is doing is right. Slapping users on the wrists and deletinginfringing videos obviously isn't enough to deter infringement.

In a FEW situations (full pre-release TV episodes,) GooTube has some grossly infringing content. That represents a problem they need to address.

For the vast majority of the rest, calling it "infringement" amounts to saying we don't have the right to our own culture.

The crappy low-quality content on YouTube won't deprive anyone of sales. If anything, it will increase sales by reminding people of little bits of their past which they want to recapture (eg, cheesy 80's videos and saturday morning cartoons); It gives the best possible advertising for shows like The Colbert Report; It lets us all make fun of the latest absurdity uttered by the president (or Pelosi, Boxer, or [insert your least favorite politician here], they all count as pretty much equally worthless). Unfortunately, copyright law doesn't care about that - It cares only that the copyright holder (rarely the "artist", so don't even go there) didn't give permission. That must change if copyright will survive the next few years with any meaning at all.

And if we don't see a massive copyright reform in the near future? Well... Ask any 16YO whether or not they consider it "wrong" to copy a CD. Copyright has fallen to the level of speeding as a socially-acceptible crime; we all know we might get caught, we all do it anyway, and we don't care. Except, rather than a $150 fine, you can get a $150,000 fine. Ouch.

Re:Bad deal

[MindStalker]

its not "fair use" for whom? If the courts see Google and simply a carrier then the infringement is being done by the users and not Google. As long as Google takes down any infringments upon notice they are abiding by DMCA. So far the really popular videos on youtube have mostly been homemade stuff that sometimes includes a small bit of soundtrack. These are "fair use" under many interpretations, and Google making ad money from these videos is fine.

What would be interesting is if the courts declare that any ad money made from infringing videos has to be collected and given to the owner.

Re:Bad deal

[NickFortune]

Yup, and thats the law. Feeling its wrong, having it be common sense its wrong doesn't make it legal.

Changing the law will make it legal.

So in that case you wouldn't mind if someone with deep pockets were to attempt to bring about a change in that law by using its legal muscle to help establish a favourable precedent?

Well, Go Google!

Re:Bad deal

[Orbruelor]

Should ISPs be any more liable then as well? If I upload a copyrighted mp3 or avi to my personal account, or rapidshare, or megaupload, etc etc - why should anyone other than the uploader be responsible?

Re:Bad deal

[pla]

I believe that if people don't have a right to make money off of media they create they'll just stop creating it,

You can believe anything you want, but all of human history up to the past few centuries has proven that idea false. People create because we use it as a form of expression. The fact that we can get paid, for doing something we'd do anyway, just adds frosting to the cake.

If you don't like the historical argument, though, you have counterexamples even in the present. Go to any local club on a Friday or Saturday night. See those guys up on stage? They'll probably make enough to cover their bar tab. They play because they love doing it, not because they plan to make a killing off it. Some minor-celebrity local groups might scrounge a living out of it playing full-time. But again, frosting, not the cake itself.



for trying to protect their abilities to pay their mortgages and feed their children.

You mean the same artists that need to repeatedly SUE their labels to get even the meagre compensation guaranteed them by contract? Yeah, can you hear the violins?

But, will Google really protect us?

[gavink42]

I'm seriously hoping that things remain open, as far as video sharing goes. But, I feel that if Google makes all sorts of deals with the media companies, we're likely to still end up with restrictions on how/what we share.

Amicus curiae

[nwbvt]

Thats why they have Amicus curiae briefs. If Google just wanted to help YouTube defend themselves, they could have filed such a brief for much less than the 1.6 billion (or whatever it was) they spent on YouTube. Or if they really wanted to take an active role in the lawsuit, they could have waited for it to be filed and then bail out YouTube for much less money. Though its questionable whether or not they would have ever been sued in the first place had YouTube not been bought by someone who could pay up.

No matter how you cut it, this would have been a silly strategy. Can we please stop pretending we are on Google's board of directors and posting all this speculative BS on what we think they are doing or will do in the future? Please?

Why not just pay for the lawyers?

[skubeedooo]

But the third point -- Expand and protect current fair use related provisions involving copying intellectual property -- is the most important for Google.

If that were the case, google could just donate money to youtube to pay for their legal defence, and not get involved with actually owning the company. It would cost an insignificant amount relative to the $1.6B purchase fee, and they wouldn't have to pay damages in the event of defeat.

Re:not likely

[bWareiWare.co.uk]

Google could spend millions/billions on amicus filling to defend YouTube, but as soon as it looked like they might win the media companies would cut a deal with YouTube and no legal precedent would be established.

By owning YouTube the can know at least know they might win.

It was an act of hubris not a brilliant strategy!

[divisionbyzero]

I'd bet money that Google bought YouTube to get face time/leverage with television/movie execs. Google has failed miserably to get the entertainment folks on board. I think they made an expensive gamble that they could leverage YouTube to get the studios on board and they lost.

They didn't pay with real money

[Anonymous Coward]

They paid in stock, which they basically printed themselves. Not the same thing as actual dollars. Valuable yes, but not the same.

Re:YES THEY DID

[demastri]

If a company issues stock for a purchase, it dilutes the existing stock base, so it isn't like they're creating value out of thin air. if 100 shares exist, and the company's worth $100K, the shares are worth 1K each. If they print another 100 shares, all 200 are worth $500 each. Usually, stock used for purchase is already "printed" but part of the reserves of the company, so it doesn't devalue the shares, but that actual value of ownership (just as if it had been bought at market with cash) transfers to the designee.

it's EXACTLY like they paid cash, and then they took the cash and bought stock at market with it. It certainly isn't "printing money" like you implied. If you think the company will go up, it's better than cash. Since the market's open to sell the stock, they can dump it for cash and get full value for it.

Simple econ. Stop trying to make a normal business transaction sound like something nefarious...