Seriously, there is tension in play in uploading or generating copyright content, especially if your aim is to build an IP business. If you want to skip the detail and analysis then just read the last paragraph of this post.

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A battle of the titans is taking place. In one corner is a largely technological phenomenon, involving innovation which has brought about systems that are easier, faster and better at helping to generate  and upload content. Moreover, Web 2.0 development systems are so simple they can be set up and operated by individuals with little or no prior training, certainly no downloading of niche software, and not even requiring user registration in many cases. Ease of use has fed the explosion worldwide of blogs, photo and other content sharing, online comments, tagging and wiki edits. I present to you in this corner: the  Web 2.0 Titan.

The above graphic appears in the blog at www.compete.com. The listed sites each have at a minimum 20 million unique users and many depend on or at least feed off so-called “user-generated” content.

In the opposite corner we have copyright law, a law the entire history of which is about content owners or controllers dealing legally and commercially with the challenge of technologies for reproduction. In prior eras there have of course been other copying devices – photocopiers, broadcasting satellites, film cameras, record players, movie cameras and the printing press. Each technology has led to court actions, and in time, evolution in copyright law, whether by statute or court-made law. I present to you in this corner: the Copyright Law Titan.

As a simplification the recurring fear of those who take copyright law action is that their revenue or power base is or might be reduced or extinguished. Rolling backwards in time, over recent centuries the legal actions by copyright owners or controllers have been to rope in photocopiers copying in schools, image makers with cameras duplicating artworks held in museums, record companies publishing famous operas instead of buying tickets to attend them, and printing presses impoverishing newspaper serial writers like Charles Dickens.

Despite these actions, each era has seen more and more copying devices enter our homes, offices and public buildings. Other than the escalation taking place since the invention of the World Wide Web, I wonder whether there is anything materially new or different about what Web 2.0 is bringing about as regards copyright. Yes, there is a lot of hot air and even more noise about copyright law, but in the grand sweep of copyright law history is there really a great change in the works?

If you are a copyright creator, publisher, broadcaster, owner or controller I suspect the overriding real need is for adaptation by you to emerging practices and business models, not just legal defence alone.

Here’s one reason why. Legal action against operators of duplication devices in some secret garage producing unauthorised copies of a book, CD or VHS tape involves imposing a considerable financial and administrative threat on the targeted operators. These include the threat of damages, an account of profits and pulping or destruction of valuable, though illegal, merchandise. In recent times the targets face rising copyright fines, criminal offences or even risks of imprisonment.

In contrast, when infringement is in digital media like the Web an individual “take down order” for one or more items of infringing text, audio, image or video on a Website is arguably NOT AS THREATENING and ADMINISTRATIVELY DISRUPTIVE, at least insofar as with the click of a button the offending item(s) can be removed and new digital inventory added. Dealing with digital copying involves a need for adaptation in my view not wringing of hands about the challenge of digital copying devices to those whose livelihood depends on copyright law. This is not to say that digital duplicators face only a “take down order”; in fact they face the same serious legal risks as above.

Yes, entire industries have shrunk and are shrinking (like CD-based music publishers, who might soon be followed by DVD retailers) in part due to computer-based copying. Others are preparing for legal battles and negotiations on the horizon (such as TV broadcasters and film studios).

With YouTube and other video sharing businesses in their sights, TV broadcasting networks (who are also copyright licensors) are already in serious lobbying mode seeking to shape legal developments within the forum of the World Intellectual Property Organisation (WIPO). It will be helpful to them to expand the scope of their legal protection under law. Yet hasn’t it always been this way, ie interest groups seeking to protect their turf? And so it is there are no longer regular lamentations on the demise of manuscript makers replaced by printed books, theatre companies replaced by cinema, musicians replaced by gramophones and now digital devices. Some business players wither, others die, those who adapt live on.

The Web 2.0 Titan versus the Copyright Law Titan title fight is not worth running. The real story involves many shades of grey and moreover survival of the fittest. Our focus should be on what we can learn from survivors to help grow, protect and leverage your own IP portfolio and related business model.

"youtube"The fact is no commercial online or offline IP venture start-up or Internet start-up CAN SURVIVE without some review of its copyright position. The Time cover story had little meat in it, but it did have one very readable personal story on entrepreneurship about the boys at YouTube titled The YouTube Gurus. From the end of that story I’ll leave you with the following extract, for which I have added the link to Mark Cuban’s blog.

“The biggest threat to YouTube remains potential copyright lawsuits from content providers who could claim that the site—like Napster before it—is enabling thieves. In a recent report, Google acknowledged that “adverse results in these lawsuits may include awards of substantial monetary damages.” Mark Cuban, the billionaire co-founder of Broadcast.com, has said publicly for months that the potential for legal trouble makes YouTube a bad investment. YouTube has responded by publicizing agreements it has made with media companies such as nbc Universal Television to legally show video clips from, say, The Office. Still, YouTube says federal law requires only that it remove videos when copyright holders complain—not to pre-emptively monitor the site for infringements, which would destroy its spontaneity. If kids can’t play sad pop songs in the background of their video blogs, why would they blog at all?"symbol_copyright.jpg"

In an e-mail, Cuban pointed out a contradiction in YouTube’s position: “They are spending a ton of money to license content. Which makes me curious. Why license if all that content is viable under [federal law]? And when does the licensing ever end—won’t everyone want [to get] paid? Even the personal videos of cats?”

Eric Schmidt, Google’s CEO, told me his company had hired an outside firm to help it analyze YouTube’s legal risks. “And we concluded that Mark Cuban’s arguments were false. We read them, by the way. We just think he’s false. Copyright law, the safe-harbor provisions—it works, as long as we do a good job of takedown”—quickly removing videos whenever copyright holders ask.”

Despite the posturing of Google’s CEO, YouTube does have a legal issue on both sides of the Pacific and elsewhere. Relevant court precedents are the major P2P copyright court cases in the US Supreme Court of MGM v Grokster and in Australia in the Federal Court of Universal Music Australia v Sharman License Holdings. As a result of that decision against Kazaa (related to Sharman License Holdings) and subsequent legal backroom negotiations, Kazaa in late July 2006 agreed to pay A$152 million (US$115 million) compensation for past infringements. Kazza also then decided to convert to a legal downloading business offering licensed music. Grokster and Kazza fought the law, and the law won.

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