Thursday, March 15, 2007

The Challenge of YouTube

I’ve been wondering when some big media company was going to sue YouTube. Now, Viacom is seeking $1 billion for what it considers YouTube’s willful copyright infringement of everything from The Daily Show with Jon Stewart to Sponge Bob Square Pants.

Anytime I visit YouTube, I’m amazed at the breadth of content available from the site. Ostensibly, YouTube is for sharing homemade videos. But much of the site is comprised of clips extracted from professionally produced material. And that’s the problem.

As thrilling as it is to see an obscure recording of a 40s musician playing live, that clip is owned by a company and the artist is possibly owed royalties for any re-airing. But YouTube allows users to circumvent commerce – even subverts it. This may be liberating for the user but is it fair or sustainable?

Our system of entertainment is profit-oriented. If content producers cannot profit from their work, there will be no work. I don’t know about y’all, but I’d like more choices than the conspiracy theory documentaries and college-students-being-stupid video clips that make-up much of the user-generated content on YouTube. I like my network television and studio movies and I’m not ashamed to say so.

That said, I’m not convinced YouTube is significantly affecting entertainment profits—not currently at least. Their success has much more to do with the streaming-video innovations they’ve made than it does with all the Jon Stewart uploads. Viacom has a lot to prove if they want to win their case.

Most likely, the lawsuit will serve as a kind of warning shot, a notice to YouTube that they’re being monitored closely. As music downloads have proven, once a technology exists, it’s impossible to stop people from using it. Networks and studios will have to wage a two-front war: one against the sites illegally posting their content and one inside their own companies where these new technologies must be harnessed and used to create an advantage.

Many networks have already made agreements with YouTube to carry free content. But this is just the beginning. Creating a workable profit stream is the next challenge. And I’m sure YouTube will play along – after all, if there wasn’t lots of money to be made, why did Google buy the company?

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