A Brief History Lesson

Viacom Vs Google can be traced right back to May 2005 before YouTube was under the protective wing of Google. A clip from Paramount Pictures’ Twin Towers was uploaded to the site, and Viacom demanded to know who the uploader was.

In October 2006 YouTube made a deal with Viacom to syndicate content. Then Google bought YouTube for $1.65 billion. February 2007 saw Viacom retract the previous deal and pull everything off the site.

March 2007 saw Viacom sue Google for 63,000 counts of copyright infringement, for which it was seeking $1 billion in damages. Google argues that YouTube is protected under the Safe Harbor provision of the Digital Millennium Copyright Act.

BetaNews has the full timeline with many more twists and turns. But it all builds to this point when Google and Viacom’s documents pertaining to the court case have been released. And they make for interesting reading, to say the least.

Google’s Claims

Google claims that Viacom wanted it both ways, continuously uploading its content to YouTube while publicly rallying against it. Google claims Viacom uploaded roughed up versions of videos so they looked stolen, hiring marketing agencies to do the dirty work.

Google claims that Viacom even uploaded many of the clips which it is now suing over. And maintains that it is protected by the Digital Millennium Copyright Act as it removes videos suspected of infringing copyrights.

Google also makes the claim that Viacom was interested in acquiring YouTube at one point.

Viacom’s Claims

Viacom dismisses the DMCA defense as it insists YouTube is more than just a passive content host and is therefore responsible for what videos were being uploaded to the site.

What’s more, Viacom also accuses YouTube’s founders of at the very least turning a blind eye to copyright infringing clips, suggesting that traffic was sought by any means necessary in order to ensure a quick sale. Viacom also claims Jawed Karim (YouTube co-founder) himself uploaded infringing videos, using email correspondence between the founders as evidence.

In essence, Viacom argues that YouTube was “intentionally built on infringement,” and deserves no leniency in court despite the measures put in place to clean up the site since the lawsuit was issued.

Conclusions

The documents feel very much like each side is attempting to score points from the other. And it’s almost inevitable that the case will now end up in court.

The sides have until April 30 to file opposing arguments to each other’s motions, with a trial then set to take place later this year. And it’ll be a trial whose verdict could set a landmark in terms of copyright owners vs. online video sites.

Movie Piracy

Movie piracy has been with us for decades. The advent of home video made piracy a huge problem for Hollywood, and DVD and Blu-ray have continued that trend. But it’s the Internet that truly made piracy mainstream and something everyone does.

That is if you believe sharing media files on the Internet is piracy, of course. The law says it is, naturally.

File-sharing sites are probably more numerous now than ever before, with both well-known and underground options available to anyone who wants to acquire a media file – be it movie, TV show, game, computer program, or whatever – for free online.

And The Piracy Oscar Goes To…

TorrentFreak recently compiled data pertaining to the ten movies nominated for ‘Best Picture’ at the 2010 Academy Awards. The real winner of the Oscar is expected to come from Avatar and The Hurt Locker. And yet these two films play second (and third) fiddle to District 9 in the piracy stakes.

TorrentFreak’s Piracy Oscars

1. District 9 – 12,639,000
2. Avatar – 11,326,000
3. The Hurt Locker – 7,930,000
4. Up – 5,437,000
5. Inglourious Basterds – 5,376,000
6. Precious – 4,922,000
7. Up In The Air – 4,855,000
8. A Serious Man – 3,836,000
9. The Blind Side – 1,845,000
10. An Education – 683,000

It’s important to note that these films range in age considerably, and so high quality torrents have been available to download for varying lengths of time. Had they all been available for the same length of time then Avatar would undoubtedly take the number one spot.

Hollywood’s Fightback

Hollywood, the movie studios, and the MPAA (Motion Picture Association of America) have collectively tried to nip movie piracy on the Web in the bud. And they must have thought they were getting somewhere when they won their case against The Pirate Bay.

But nothing has really changed. The Pirate Bay as merely one conduit for movie piracy. And there are plenty of other options open to people willing to break the law and download movies online.

Conclusions

The point is that Hollywood hasn’t yet got a handle on Internet piracy. It isn’t going anywhere, whatever efforts are made to that end.

The key for the movie studios is to both utilize the technology to their own advantage and make sure there are legal, low-cost alternatives which could help discourage people from taking this route. Until then, all the Oscar hopefuls will be heavily-pirated ad infinitum.

But as the $2 billion box-office takings of Avatar prove, it’s not like Internet piracy is really harming Hollywood anyway.

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Google’s YouTube

Google acquired YouTube for a whopping $1.65 billion in October 2006, just 18 months after the domain name was registered. Google CEO Eric Schmidt has since stated he thinks the company paid way over the odds for the startup, but that it was a necessary purchase.

What Google got was a YouTube that’s very different than the one we see today. Piracy was still rife, with unauthorized clips all over the site. Although these were eventually removed it took a lot longer than it does these days.

YouTube Revenue

YouTube has likely never made money for Google, at least if analysts’ previous attempts to estimate the incomings and outgoings of the company are to be believed.

However, according to MediaMemo, Citigroup’s Mark Mahaney has a different view. He estimates that YouTube made around $727 million in revenue in 2009, will make $945 million in 2010, and $1.1 billion in 2011.

He doesn’t mention the expenses YouTube carries with it, which are likely to be vast. However, with those sorts of revenues there’s a strong chance that YouTube is either already turning, or about to turn, a profit for Google.

Mahaney’s methodology was simple: transpose MySpace’s revenue-to-page view ratio with YouTube’s. Which is hardly scientific but is as good a method as any with Google continuing to keep official figures confidential.

Google Vs. Viacom

Today has also brought new news in the continuing legal battle between Google and Viacom. The latter sued the former for $1 billion in damages way back in 2007, alleging “massive intentional copyright infringement.”

Viacom’s complaint is that Google profited from the 160,000 unauthorized clips on the site before new methods were introduced to combat uploading of pirated video clips.

According to CNET, both sides are filing motions for summary judgment. In essence, this means that the talking is over with both sides now confident enough to put their case forward. It’s now up to the judge to decide the next course of action but the case is likely to come to a head very soon.

Hulu Loses Big Names

Two of the most popular shows on Hulu are The Daily Show and The Colbert Report. Unfortunately, neither will be available to watch on Hulu after March 9 as Viacom has decided in its infinite wisdom to pull all Comedy Central content from the site.

This is a big deal when you consider The Daily Show is only behind Lost and Family Guy in terms of the number of viewers it gains on Hulu. So if even those kinds of viewing figures aren’t making it worth Viacom’s while what about the less popular shows?

Hulu’s Big Problem

This sums Hulu’s problem up in a nutshell. While it’s the most popular TV catchup service on the Web in the U.S., it is wholly reliant on the networks and content creators for its product. If that disappears then Hulu is left with nothing to sell. Or at least no content to sell advertising against.

The same is true for any content aggregator, of course, but Hulu is slap-bang in the middle of an emerging market which could still evolve in a number of ways. And it could turn out that Hulu is crowded out of the market by initiatives such as TV Everywhere.

Viacom Threatens To Sue

For viewers this news won’t mean too much. Both shows will still be viewable online (in the U.S. only, naturally) on their own Web sites. However, the art of embedding is going to be affected.

While Hulu has the whole show and allows users to crop whichever section they want to, Comedy Central only makes certain clips available. Which is bound to lead to unauthorized clips being uploaded on sites such as YouTube.

The Hollywood Reporter quotes PR rep Tony Fox in saying, “My feeling is if (websites) are making money on our copyrighted content, then that is a problem.” he also answered, “Yes, we intend to do so,” when asked if Viacom will now target sites and bloggers who post clips from the shows in question.

Ars Technica got spun a different story, but it’s clear the company will be closely monitoring online video sites after The Daily Show and The Colbert report are removed from Hulu.

Conclusions

Viacom and Hulu were reportedly discussing a deal right up until the last minute, but one which pleased both sides couldn’t be found. My guess would be Viacom was after a bigger slice of the revenue pie, and Hulu cannot really afford to give up any more at this time.

Maybe when Hulu starts charging Viacom will have a change of heart. In fact, I’d suggest it’s inevitable.

Rickrolling Phenomenon

Any regular Web user will no doubt be aware of the phenomenon that is Rickrolling. In fact, everyone has probably been Rickrolled on more than one occasion.

Rickrolling began on the 4Chan message board back in 2007 but soon spread to the rest of the Web. In essence, you post a link to something you describe as interesting, cool, or must-see, when in fact the link leads to the music video for Never Gonna Give You Up, a Rick Astley track that sums up 1980s cheese in one three-minute package.

Rickrolling became so big that Google used it as one of its April Fool’s Day pranks in 2008, linking all the featured videos on YouTube’s front page to the Rickroll video. And then Rick Astley himself turned up during the Macy’s Thanksgiving Day Parade in November of that year lip-syncing the lyrics to the millions of people watching at home.

Although according to Pete Waterman, the song still didn’t make a fortune, despite its new-found fame.

Original Video Removed

As first noticed by Neowin, the original Rickroll video, which has been up since May 2007, disappeared on Wednesday morning, with a “This video has been removed due to terms of use violation” message displayed instead.

A collective gasp then went round the blogosphere and social networking sites as people reacted to the news. Could the art of Rickrolling really have been killed off? And why, after nearly three years on the site, had the video now been pulled?

Original Video Restored

It was a mistake, pure and simple, with YouTube spokesperson issuing the following statement while restoring the video to its former glory.

“With 20 hours of video uploaded every minute to YouTube, we count on our community members to know our Community Guidelines and to flag content they believe violates them. We review all flagged content quickly, and if we find that a video does violate the guidelines, we remove it, on average in under an hour. We also have a team that is dedicated to identifying and removing spam from YouTube.”

“Occasionally, an account flagged by users or identified by our spam team is mistakenly taken down. When this is brought to our attention, we move quickly to take appropriate action, including restoring videos that had been mistakenly removed and channels that have been mistakenly suspended.”

Conclusions

After the absurd decision by Italy to convict three Google executives over a UGC video which had nothing to do with them, maybe YouTube is being a little overcautious and overzealous in its take-downs at the moment.

Whether that’s the case or not, I’m glad the Rickroll video is back. It’s one of those Web phenomenons that is sure to fall in and out of favor but never truly disappear. Unless YouTube removes it again, and for good next time.

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Google Video Upload

In 2006, before Google acquired YouTube, a short video appeared on the now-defunct Google Video showing a disabled teenager being bullied by a group of his peers. One of the teenagers had uploaded the video, which remained on the site for a couple of months until complaints were received.

At that point, Google removed the video as fast as it could, and helped the Italian police track down the people responsible. The female uploader and several of her classmates were sentenced to 10 months community service.

That surely should have been the end of this sorry story, but it wasn’t.

Google Execs Charged

In July 2008, four Google executives were charged with criminal defamation and a failure to comply with the Italian privacy code. All over a video that had nothing whatsoever to do with any of them. They merely worked for the company which hosted the video online.

Italian prosecutors then spent more than a year building a case against the quartet before the trial began in October 2009, with reports in November suggesting that jail time was being sought.

Google Execs Convicted

The verdict was announced this morning, and while all four of the men on trial were absolved of the defamation claim, three were convicted of bypassing Italian privacy laws.

The three convicted men, David Drummond, Peter Fleischer, and George Reyes have each received a suspended six-month sentence.

Google has responded to this verdict and sentencing in a vitriolic blog post, stating:

“In essence this ruling means that employees of hosting platforms like Google Video are criminally responsible for content that users upload.”

“It attacks the very principles of freedom on which the Internet is built. Common sense dictates that only the person who films and uploads a video to a hosting platform could take the steps necessary to protect the privacy and obtain the consent of the people they are filming.”

And I have to agree. This verdict is complete nonsense and would appear to go against established European Union laws which state that companies hosting content have a safe harbor so long as content found to be illegal is removed upon request. Which it clearly was in this case.

The Future For YouTube?

This verdict, if upheld on appeal, could be very serious for Google, YouTube, and all content-hosting companies in Italy, Europe, and beyond. As it implies they are responsible for the content being uploaded at all time, no matter what action is taken after the event.

For YouTube specifically, this kind of case could only be prevented in the future by all UGC videos being moderated before they appear on the site. Which, with 20 hours of video uploaded every minute worldwide, would be a near-impossible task.

The results of two recent court cases in the U.K. suggest that linking to but not hosting copyrighted content isn’t illegal, at least in Europe. Both TV-Links and the music-oriented OiNK have been cleared in the last month of the charges brought against them.

Linking Vs. Hosting

Hosting copyrighted content is illegal. That is an accepted part of the legal system. However, things get a little murkier and confused when a site is acting as a third-party, a go-between matching those hosting the content and those seeking it.

This has been tested in court a number of times, and the results have been mixed to say the least. In the U.S. it would appear linking is illegal, and sites such as Google only get away with it because of their Web directory nature, and even they have to remove links if asked to.

However, in the U.K., and potentially all countries in the European Union, linking to copyrighted material is not illegal.

TV-Links

TV-Links was a UK-based site which linked to movies and TV shows hosted on the likes of YouTube, MySpace Video, DailyMotion etc. in the days before those sites were so quick to take down infringing content as they are now.

But in 2007 TV-Links was closed down after the police and FACT (Federation Against Copyright Theft) claimed it was “facilitating” copyright infringement.

It’s taken over two years for the case to reach court, but as TorrentFreak reports, it ended with the admins David Rock and David Overton winning.

The judge referred to Section 17 of the European Commerce Directive 2000, which gives sites a full defense if on trial in England and Wales for merely linking to another site’s content. In effect, it cannot be illegal to act as a conduit rather than the deliverer.

OiNK

The TV-Links win follows on from Alan Ellis, the creator of OiNK.cd, last month being cleared of conspiracy to defraud for supposedly making money from the sharing of music files.

Interestingly, Ellis used the Google defense (a similar defense was argued unsuccessfully by The Pirate Bay), stating, “All I do is really like Google, to really provide a connection between people. None of the music is on my Web site.”

And it worked.

Conclusions

This doesn’t mean that it’s necessarily OK to link to copyrighted material without permission. However, the TV-Links case in particular could set a precedent for similar cases in the future, at least in the U.K. and possibly other E.U. countries.

Veoh’s Bright Beginning

Veoh began life in 2005 before entering beta in 2006. Founded by Dmityr Shapiro, the company made the headlines when Michael Eisner, former Disney chairman, joined the board. And he was one of the big-name investors alongside Time Warner and Goldman Sachs.

Veoh was talked about in the same vein as YouTube, offering a mix of user-generated content and premium content. Veoh’s goal was simple: to aid the viewing of video content and the uploading of video from ordinary people.

But things soon turned sour.

UMG DMCA Lawsuit

In September 2004, Universal Music Group filed a lawsuit against Veoh alleging that copyright infringing videos were present on the site. However, Veoh was playing by the rules, removing videos found to be infringing copyright.

UMG’s reasoning for why Veoh wasn’t protected under the DMCA Safe Harbor provision was that in converting the files into the Flash format they were republishing the content and therefore wholly responsible for it.

The judge disagreed with UMG’s arguments at every turn, last year issuing a summary judgment in Veoh’s favor.

Veoh’s Dismal Ending

Unfortunately the case took a lot out of Veoh, costing it a lot of money, hitting the confidence of management and staff alike, and dissuading investors from working with the company.

Veoh limped on, changing strategy and laying off staff in an attempt to right the ship. But traffic slumped and Veoh let go of its remaining workforce on Wednesday. It is now preparing to file for Chapter 7 bankruptcy.

Shapiro confirmed the already-rumored news in a heartfelt but ultimately positive blog post yesterday.

Conclusions

It’s a real shame to see Veoh go out this way, but the writing has been on the wall for a while now. What the company has left the industry with is an important legal precedent derived from its victory over Universal.

Boxee Vs. Hulu History

It was almost a year ago when Hulu decided to pull its content from Boxee. TV.com also lost out. The decision was made after the networks and cable companies declared they didn’t like the way their premium content was being viewed on television via Boxee via Hulu.

In essence, they were only happy with Hulu while it remained a computer-only affair. Boxee enabled Hulu to be experienced on TVs and that just wouldn’t do as it may influence people’s decision to cancel their cable subscriptions in favor of online video.

Boxee responded by issuing a workaround to the Hulu block. Which Hulu then plugged, only for Boxee to unplug it. The cat and mouse game has continued since then, with some Boxee users able to watch Hulu programming and others not.

NBC Explains To Congress

Congress is holding a hearing concerning Comcast’s proposed acquisition of NBC Universal. And it was during this that Jeff Zucker, President and CEO of NBC, was asked about Hulu blocking Boxee users from accessing its programming.

Zucker was clearly surprised by the line of questioning and faltered the answer:

“This was a decision made by the Hulu management to, uh, what Boxee was doing was illegally taking the content that was on Hulu without any business deal. And, you know, all, all the, we have several distributors, actually many distributors of the Hulu content that we have legal distribution deals with so we don’t preclude distribution deals. What we preclude are those who illegally take that content.”

He was then asked whether NBC would negotiate with Boxee, to which he replied, “We have always said that we’re open to negotiations.”

Why Hulu Is Wrong

Zucker, and consequently Hulu, is fundamentally wrong on this one. As Boxee explains in a measured blog response, Boxee accesses content using a Web browser. There is no taking of video, no adding of adverts. In fact, it works exactly the same way as Internet Explorer, Firefox, Chrome, and the Hulu Desktop.

And yet Boxee has been singled out for exclusion from access while Microsoft, Mozilla, Google and the rest happily act as a go-between without any of these so-called “legal distribution deals” in place that Zucker referred to.

Conclusions

There is absolutely no logic to Hulu’s continued banning of Boxee. And Zucker’s response to the question about it and Boxee’s explanation of why he is wrong frame the issue in as succinct a way as possible.

Let’s hope Hulu and Boxee either do now come to some arrangement or that Congress pushes further for an explanation of the issues involved. Because it makes no sense whatsoever, especially as Boxee would increase Hulu’s potential audience.

Online Video Matures

Online video has matured over the last few years, by quite a lot. It was only a short few years ago when YouTube was a pretty lawless place, with copyrighted content being uploaded left, right, and center, and very few checks and balances to stop it appearing.

But those checks and balances are now in place, and the Google-owned YouTube now plays pretty much by the rules. As does every other legitimate online video offering.

But the Italian government doesn’t think it’s enough.

A Different Beast

Online video in all its different forms cannot be compared to and treated the same as traditional broadcast TV. It’s a different beast, and the Internet makes the whole thing a completely different prospect for all parties concerned, from content providers to regulators.

Unfortunately, the current Italian government doesn’t see things that way, and is attempting to push new rules into law which will see online video regulated, with Internet Service Providers asked to act as policemen.

Berlusconi’s Baloney

According to Bloomberg, the Italian government passed rules in December that are set to become law on Jan. 27. Assuming opposition parties fail to stop the change occurring, Italy’s communications regulator would suddenly gain extra control over any Web site which stream video on a regular basis.

Italy’s ISPs would be expected to remove any content the regulator deems illegal or face huge fines.

As Dario Denni, head of the Italian Association of Internet Providers, said in an interview:

“It’s like holding the company that maintains the highways responsible for what the drivers do. It doesn’t make sense.”

Conclusions

I’m guessing the fact that Berlusconi is the Rupert Murdoch of Italy has at least something to do with this. He controls Mediaset SpA, the largest private TV broadcaster in the country, which just happens to be suing YouTube for copyright infringement.

Still, it’s a potty idea that has no basis in a sensible and cohesive approach to online video.