Commentary--Viacom vs. GooTube: Napster All Over Again?
Some folk tales are universal. The details might change, but the general narratives, themes, and lessons are the same from one culture to another, from one epoch to the next.
One such story, told in ancient cultures from North America to India—and repeated more recently in places as diverse as an Ann Landers column, an investment website, and Quentin Tarantino’s Natural Born Killers—tells the tale of a woman hiking up a snowy mountain. She happens upon a rattlesnake, who says, "I’m freezing and I’m dying. Please take me with you to the top of the mountaintop so I may see the sun set one last time."
After some internal debate, the woman’s fear is overcome by compassion, so she picks up the snake, puts it in her coat, and takes it to the top of the mountain. Upon return to the woman’s camp, she feeds the snake and lets it sleep by her fire. The next day, the snake turns to the woman and says, "I’m close to my final hour. Please take me to my home so I may die there."
The woman goes to pick up the snake again, only to have it strike and bite her in the chest. "Mr. Snake," the woman cries,"Why did you do that? Now I will die."The rattlesnake smiles at her and says "You knew I was a snake when you picked me up."
And so it is in business. If you enter into a deal with a snake, you deserve to get bit. Which is why, of course, savvy businesspeople avoid such reptilian interaction.
Evidently, though, savvy people with $1.65 billion in stock to burn figure that the occasional snakebite is merely the cost of doing business in the high-stakes world of Web 2.0. It’s ironic that such grassroots movement—blogs, social media, user-generated video, and other content will supposedly "democratize" the internet—produced a property worth so much. Everyone’s an outsider, I guess, until enough money’s on the table.
But that’s a different subject than what I’m talking about here, which is of course the Google acquisition of YouTube last October, and the subsequent (and inevitible) lawsuit for copyright infringement that followed in March. Viacom seeks more than $1 billion in damages and an immediate injunction prohibiting GooTube from using any of its content on Google Video or YouTube.
Google CEO Eric Schmidt has insisted in the press that the Digital Millennium Copyright Act’s safe harbor clause protects the company. And it might; as Ziff Davis’ Steve Bryant writes, "Seeing that there are infringing works on the site and seeing that fact in a database that you monitor are two different things." Unless Viacom can prove that Google has continuous and active knowledge of each infringing work as it is uploaded, Google might very well satisfy the requirements of the safe harbor clause. Of course, chances are good that the lawsuit will be settled out of court anyway, with all parties emerging with higher profiles (especially Viacom, which recently entered a licensing deal with Joost).
The bottom line, though, is that Google certainly knew such a lawsuit would be forthcoming when they picked up YouTube. But who’s the snake in this story? Is it YouTube, which established its value in large part by becoming a repository for all manner of copyrighted content? Or is it Viacom, which failed to see that sites such as YouTube might very well increase rather than decrease content’s value?
Heaven knows that the ability to catch clips from Comedy Central’s The Daily Show and The Colbert Report only helped the overall market awareness of those Viacom properties rise. And "Lazy Sunday," the Saturday Night Live clip that made YouTube a household name in late 2005, brought more publicity to that show than NBC could have ever drummed up on its own.
It really is Napster all over again, though the stakes are higher and the networks and studios are slightly farther ahead of the technological curve than the record labels were in 2000. And just as Napster publicized the potential of music delivered over the internet, so has YouTube—more than any other single entity—opened people’s eyes to the viability of watching video on the web.
I’m not arguing for the abolition of intellectual property law. But while up-and-coming filmmakers and musicians have seized the web as a means of promoting their art, er, intellectual property, so should the major entertainment players recognize that, like terrestrial radio, the web serves as a way for fans to find new favorites they’ll then invest in either directly with their wallets or indirectly by turning to the "official" ad-supported sources. Or that other companies will learn how to monetize content in new ways.
And take a look at the nearly universal archetype of ouroboros: Sometimes, snakes bite their own tails.
In a first, Viacom is packaging movies and TV shows from its studios in a streaming service, offering first-run films, classics, and popular series.