News: Wired has an interview with Google CEO Eric Schmidt in which he discusses YouTube and the Viacom copyright lawsuit. Here’s the relevant part:
Wired: In March, media giant Viacom sued Google, claiming that YouTube is stealing its video content. What made Viacom decide to go to court?
Schmidt: It’s a business negotiation. We’ve been negotiating with them, and I’m sure at some point we’ll negotiate with them some more.
Wired: Viacom’s argument is that you’re not working hard enough to keep infringing clips off of YouTube.
Schmidt: Well, if they would look at the law, they’d understand that under the Digital Millennium Copyright Act, there’s a shared responsibility. The law says that the copyright owner monitors — and then we expeditiously remove — offending clips. We’ve done that. In fact, YouTube’s traffic has grown since we did. So Viacom’s argument that YouTube is somehow built on stolen content is clearly false.
Wired: How could copyright law in the digital age be clearer?
Schmidt: The balance that was struck in the DMCA has worked pretty well, and I think it may be better for all of us to work within that framework for a while as we develop these new businesses. It’s the unintended consequences of new laws that always get you.
Analysis: Eric Schmidt’s comments are well taken. First, he’s exactly right about the DMCA safe harbor provision — service providers like YouTube do not have to affirmatively patrol their site for copyright infringement. The legislative history and case law on the DMCA are pretty clear about that. In a networked environment, it would be virtually impossible for Internet service providers to have to patrol their sites for copyright infringement. Viacom doesn’t like patrolling YouTube for copyright infringement but that burden is relatively small when compared to the burden YouTube would face in having to patrol its site for all copyright infringement. Viacom is only one copyright holder and only has to look for its own shows on YouTube. But the reverse rule sought by Viacom would mean that YouTube would have to look for copyrighted works of not just Viacom, but hundreds, if not thousands, of copyright holders. Schmidt’s right that, under the DMCA, there is a “shared responsibility” among Internet service providers and copyright holders.
Second, Schmidt refutes Viacom’s assertion in its complaint that YouTube’s business model is built on “stolen content.” Referring to a recent study that indicated YouTube’s traffic increased after Viacom’s shows were removed from YouTube, Schmidt says that Viacom’s assertion is “cleary false.” I’ve already blogged about this aspect of Viacom’s complaint before — it seems overblown to me and vulnerable to summary judgment.
Third, the most revealing aspect of Schmidt’s comments, though, are not legal. Schmidt says that the lawsuit is a part of the “business negotiations” with Viacom. You don’t even have to read in between the lines to conclude that a settlement of the case is very likely. One of the things that I’ve learned since I started following YouTube is the important role business and consumer dealings play in or in addition to copyright law. It would be a mistake to think of the dispute between YouTube and Viacom only in terms of copyright law. Even the DMCA safe harbor provision is premised on a certain practical arrangement that accepts the existence of some “network” type infringement on the Internet.
That said, Viacom could always elect to forego settling the case and pursue it the very end. But could Viacom afford the risk of losing the case and giving Google even more bargaining power?