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Posted by: Jon Fine on March 13, 2007
The first shoe drops: Viacom sues YouTube for a billion-plus dollars, claiming “massive, intentional” copyright infringement.
Is it the last shoe to fall? Probably not. Is this the end of YouTube? No way.
I should probably get out of the prediction game once and for all, but what I keep coming back to is this:
1. No network—or networks—will be able to build a YouTube on their own
2. The ancillary traffic to Viacom clips will always be much greater at YouTube than it would be at any Viacom or Viacom-plus-whoever-site; control as the networks once understood it is over, etc.
3. Thus, it would make sense for Viacom to partner with YouTube, and especially to partner with a company that’s proven adept out of putting a system to target ads around truly massive traffic … .hmmmm … now who would that be?
4. Google/YouTube have a strong incentive to make the big network players happy, unless they want a million other suits like Viacom’s.
5. The real threat isn’t YouTube, the real threat is file-sharing from millions of other sites like dailymotion and liveleak and on down the line. Cutting a deal with Google/YouTube removes much of the incentive to check Viacom clips out on any one of those sites—and it makes Google an ally in that fight.
6. The networks need the money, and eventually Google/YouTube will, too.
Everyone needs each other too much. This is why ultimately I regard Viacom’s move today as a harder-edged negotiating tactic. Things have escalated beyond the grumbling-in-the-press stage. Which means that things are now about to get really interesting.
The media, entertainment and marketing worlds continue to shapeshift on a near-daily basis, as new forms arise and old assumptions erode. Where is it all going? No one really knows. But on this blog BusinessWeek’s media writers Tom Lowry and Ron Grover promise to provide ample helpings of scoop, provocation, and sharp analysis as they track and annotate this constantly changing terrain.