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Viacom CEO Philippe Dauman on Google's 'rogue company'

Viacom chief says Google has an inability to bend in negotiations with Hollywood and suggests it was always Google's strategy to ignore piracy on YouTube so the site could "dominate the space."

SAN FRANCISCO--Viacom CEO Philippe Dauman doesn't typically bash Google in the press.

While Google CEO Eric Schmidt has publicly ridiculed Viacom for filing a $1 billion copyright claim against Google and YouTube, Dauman is usually more reserved.

But at a small press gathering Monday night in San Francisco, Dauman discussed some of the events that led up to the lawsuit and what he sees as wrong with Google's handling of the entertainment industry. (I wasn't taking direct notes, so I'll paraphrase most of what he said.)

First, Dauman noted that one of the first meetings he had after taking over as Viacom's chief executive in September 2006 was with Schmidt. Dauman said he and his managers were relieved when Google purchased YouTube for $1.7 billion in October of the same year because up to that point, they had considered YouTube a "rogue company."

He was referring, of course, to all the unauthorized clips from feature films and TV shows that appear on YouTube.

Dauman said he was sure Viacom would eventually cut a deal with Google and was disappointed when the two companies failed to reach an agreement. But his disappointment turned into something else when clips from Comedy Central, MTV, and Paramount Pictures--all owned by Viacom--continued to accumulate on YouTube.

"You can't just take it from us," Dauman said. He added that he believed Google's strategy all along was to defy copyright owners just as long as it took to "dominate the space."

He argues Google didn't do anything to prevent piracy on YouTube because it helped draw a massive audience.

If Dauman is correct, then the strategy worked. YouTube has more than 70 million monthly unique viewers. No video site on the Web comes close.

What about the risk of lawsuits? Google has plenty of money and probably considered the $1 billion it would have to pay Viacom should it lose in court as an acceptable risk, Dauman speculated. The case isn't scheduled to go to trial until sometime next year.

Dauman said Google, which has been open about its struggles to generate revenue from YouTube, may have difficulties negotiating content deals with Hollywood in the future unless it changes its negotiating strategy.

Dauman, whose son works for Google, said Google's unwillingness to bend in negotiations has led to a sparsity of legal premium content on YouTube. Google must learn the value of "making friends" and the necessity to give as well as take, Dauman said.

Google has always said it respects copyright and is working on filtering systems to help eliminate pirated content. Indeed, Google does appear to be making peace with some of the studios.

Last week, Lionsgate struck a content partnership with YouTube that is unprecedented among the major Hollywood studios.

Sources have told CNET News that more such deals are on the way.