Cracking Down on Video Piracy

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No Takedown Notice Required

MySpace begs to differ. Audible Magic's technology works by enabling content creators to upload audio tracks of their songs or videos, for free, to its database, says company founder and CEO Vance Ikezoye. It then assigns rules to each audio track based on the agreements the content providers have with Internet sites. If the site has an agreement to allow the content to play, Audible Magic technology recognizes it and allows it to be uploaded. It also tracks how often it is played for the purposes of ad revenue-sharing agreements or market research. If the content is identified as not permitted, the technology blocks it from being uploaded. A takedown notice requesting removal of the offending material from the site isn't necessary because uploading of the content isn't allowed in the first place.

Since launching in 1999, Audible Magic has built a database of most music from major labels and has expanded into video content. It charges Internet services flat fees based on the number of uploads to a site. "It is much more proactive from the sites' point of view than just reacting to some request to take it down," said Ikezoye. "If you want to survive and make these sites work, then ultimately cooperating with the copyright holders is going to be best."

Audible Magic's technology is used by video-sharing site Grouper, which Sony (SNE) acquired last year, and a host of other sites. And it's not the only fingerprinting technology out there. Video-sharing site Guba developed a similar screening tool with the Motion Picture Association of America called Johnny. The company says that it affirmatively blocks copyrighted material from being uploaded to the site.

Waiting for Google

What irks media companies is the existence of technology that could help alleviate some of their concerns but doesn't appear to be in wide use by Google. If these technologies can work on a large scale—which some would argue remains to be seen—these companies wonder why Google doesn't license, buy, or have its army of engineers develop similar technology. "We have to assume that the technology is out there," says Viacom spokesman Jeremy Zweig.

The answer may be that Google simply doesn't have to. As it stands, Google's policy of waiting for a takedown notice complies with copyright law, which puts the onus on the copyright owner to find infringements and request removal. Any change in legal interpretation, perhaps brought about by more affirmative actions from Internet companies such as Google, could have a slippery-slope effect, changing the rules for not just hosted video-sharing sites but also blogs and other sites where search engines direct traffic. Imagine the expense of Google having to check for copyright violations not just on YouTube but on all of its Blogger content. Right now, the media companies must police those sites.

Still, Google may have no other choice if it wishes to do business with the Viacoms of the world, says Forrester's McQuivey. "I think at some point they are going to have to give in and make nice in the sandbox with the media companies," he says.

Holahan is a writer for BusinessWeek.com in New York .