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Viacom: Google used piracy to coerce content owners

Viacom claims court documents released Thursday show Google used "copyright threat" to coerce copyright owners to license content to YouTube.

Viacom says newly released documents in its copyright fight with Google over the search engine's YouTube subsidiary help prove its case.

Greg Sandoval/CNET

We've heard these kinds of sweeping declarations from both sides throughout the legal standoff, which began when Viacom filed a $1 billion lawsuit against Google in 2007, claiming YouTube encouraged users to commit intellectual property theft. A review of the documents filed with the court on Thursday shows that much of the material, such as Google employees making critical statements about YouTube's "rogue" business model before buying the video sharing site in October 2006 have been well covered.

But Viacom said in a statement that the new documents show Google "made a deliberate, calculated business decision not only to profit from copyright infringement, but also to use the threat of copyright infringement to try to coerce rights owners like Viacom into licensing their content on Google's terms."

"It's revealing that Viacom is trying to litigate this case in the press," said a YouTube representative. "These documents aren't new. They are taken out of context and have nothing to do with this lawsuit."

Viacom has indeed alleged many times in the past that Google very early had the ability to prevent pirated content from going up at YouTube but chose not to do so. Viacom suggests that Google told film, TV, and music companies that if they wanted their content protected at YouTube, they would have to license that content to YouTube under favorable terms.

Despite Google's claims that the revelations Thursday aren't new, Viacom did produce a previously undisclosed slide from a Google presentation from 2006. The document appears to outline a potential strategy for handling content and entertainment companies and some of the contents raise questions.

On a page titled "Overall Recommendations" Google managers list a series of bullet points:

• Change terms with premium content providers.
• Pressure premium content providers to change their model towards free.
• Adopt "or else" stance (regarding) prosecution of copyright infringement elsewhere."
• Set up "play first, deal later" around "hot content."

The date on the presentation was March-May 2006, at least five months before Google acquired YouTube. At that point Google's video-sharing site, Google Video, was falling behind YouTube, which was becoming synonymous with online video.

So, does the document Viacom produced signal that Google decided to adopt a more aggressive approach to content and entertainment companies, one that mirrored YouTube's? Or was this an outline for a policy that Google wanted content creators to adopt?

"Set up 'play first, deal later' around 'hot content.'"
--Google presentation on video strategy

For instance, the line about adopting an "or else stance" regarding copyright infringement could have been Google's plan to get studios and music companies to force YouTube to do more to stop piracy. Viacom has already produced numerous documents that show many at Google--before it acquired YouTube--believed the video site wrongly benefited from the unauthorized film and TV clips posted to the site.

On Thursday, Viacom offered more of these statements. "[W]e should beat YouTube by improving features and user experience, not being a 'rogue enabler' of content theft," said one Google senior employee, according to court documents.

As for the line about "play first, deal later around hot content," it's harder to determine what message Google might have wanted to convey to the studios with that statement.

Some content creators will likely read that and believe Google was preparing to adopt a policy they claim many technology companies have embraced over the years: ask forgiveness, not permission.

Media companies have long accused start-up online music and video services of deliberately using their material without permission in order to build audiences, and later, after establishing their businesses, request licensing deals. Critics of the start-ups say that this is done to improve their bargaining power. A studio or music label may find it harder to say no to a licensing deal when a service already boasts millions of followers, or so the theory goes.

Neither Google nor Viacom commented directly on the slide. Google has always said that it respects copyright owners, has numerous partnerships with progressive-thinking film and music providers, and is protected by the Digital Millennium Copyright Act.

The DMCA says that Internet service providers are protected from liability for copyright violations committed by users. The case is expected to go to trial sometime this year, but that won't likely be the end of the fight. Whoever loses this round will undoubtedly appeal. In May 2008, Schmidt said he is prepared to fight Viacom all the way to the Supreme Court.