Viacom Sues YouTube for 1 Billion

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Viacom Sues YouTube for 1 Billion

Tue, 2007-03-13 08:21 — Jeff

Yes, you read that right. Viacom has filed a lawsuit against YouTube seeking 1 billion in damages. Viacom is claiming that YouTube has displayed more that 160,000 unauthorized video clips from it's various cable networks. 1 billion dollars is about 60% of YouTube's total worth.

Darren and I have been saying for months now that YouTube is going to eventually just get sued right off the face of the earth. I've openly wondered what in the world Google was doing purchasing a site which was bound to be such a massive legal problem. Doesn't make any sense to me. There is no doubt that YouTube is a cool concept and for allowing people to share videos they shot themselves with their friends it's very useful and completely legal. The problem is they have allowed people to rampantly violate copyrights and you just knew that the major media companies weren't going to let that slide.

If they go after music pirates and movie pirates, why wouldn't they go after YouTube?

I can see a solution to this problem being the pre-roll ads which would be displayed before each clip. Most of the clips on YouTube are short in nature and can actually be used to promote a show. I don't think anyone would argue that a short clip of your favorite comedy makes you want to see a full episode. If you've watched a clip of Family Guy on YouTube I would be pretty confident that you've turned around and watched the show on Fox. If you've never heard of the show, watch that clip, and tune in then that network has picked up a new viewer for no cost on their part. YouTube could share the advertising profits from the pre-roll advertisements with the movie and television studios in return for being left alone. The problem is, I think pre-roll advertising would absolutely kill the traffic to YouTube. I know I'm not going to watch a 30 second commercial to view a 20 or 30 second clip of a show.

This is just the first of many legal problems YouTube is going to be hit with. It's going to be interesting to monitor this situation and see how it all goes down. Getting sued for 60% of your companies worth and then losing would be a big first nail in the coffin.

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