The cooperation between the major networks (and Veoh and Dailymotion) to create principles for finding and removing copyright infringing content on UGC services is a first for networks previously unable to come together in their digital media strategies. These guidelines are a long time coming.

But getting all networks together to agree on principles for user-generated content and video sharing has resulted in some vague principles and an alliance that leaves room for anticompetitive cooperation down the line.

At a minimum these guidelines will raise the barrier to entry for startups looking to begin file sharing services. I had intended to run through point by point, but it’s dry. So here are the cliffs notes, key points that stood out:

• UGC Services must place warning signs on their site which are visible while you upload and in the terms of use. Most sites terms of use already prohibit infringing uploads anyway - they need that verbiage in there to protect themselves.

• Reference to content identification technology and what that consists of is intentionally vague, meant to adapt to whatever the coalition believes is the best technology at the moment.

Because there are few standards for what constitutes acceptable ID technology it’s up to the coalition to specify what is “commercially reasonable.” Once the major networks partner with providers the potential exists for these accredited sources to engage in anticompetitive pricing or practices forcing out smaller players in the space.

• The guidelines get into specifics on use of reference material to seek out infringing content, blocking that content and working with UGC services to implement ID and pre-emptively, pro-actively and retroactively remove content illegally shared on these services.

• Not only should UGC sites block infringing content, they should also block links to sites that include infringing content. This makes sites even more accountable than most have been so far, and requires increased monitoring of comments and user-controls.

• UGC sites should provide rights holders with enhanced search capabilities to make it easier for entertainment companies to find illegally uploaded content on UGC sites. Basically, the copyright holders want a back-end solution for finding illegal content to make the lives easier for the

• Copyright owners should accommodate fair use. Nice of them to accommodate the law, but what constitutes fair use is still in many cases disputed and open to interpretation.

• UGC sites should keep records related to users and content that has been removed for at least 60 days including IP addreses and time and date consistent with all applicable privacy laws, and should provide that information to copyright holders. Not very end-user friendly.

• If UGC sites adhere to these principles copyright holders won’t sue them. “Copyright Owners and UGC Services should continue to cooperate with each other’s reasonable efforts to create content-rich, infringement-free services” and should work together to test new technology and update these principles as warranted.

Notably missing from this group is Google, which is big enough that it can stand up to the rights holders and seems set on their new world order argument that people are using media in fundamentally new and different ways, and that they will set the guidelines for this.

It’s also interesting that Veoh has aligned themselves with broadcast media companies following their dispute with UMG. Television continues to take a much less aggressive, but no less serious stance than the music industry in fighting copyright infringement, choosing engagement and diplomacy rather than all-out attack.

Finally. At last. Phew. About F*&ing Time.

YouTube announced yesterday that they have begun testing an anti-piracy video batching database to protect themselves from copyright infringement lawsuits. The original announcement of the YouTube Video Identification system was back in June.

According to the Official Google Blog, the Video Identification system goes above and beyond the company’s legal responsibilities, but I’m not entirely sure thats the right message for them to be putting out. “We do what we can,” isn’t the warm, fuzzy sentiment that will prevent future lawsuits.

It remains to be seen how well the technology works, and how easily it can be circumvented by modifying basic elements of a video file. Additionally, the burden of the workload seems to be put on the content owners. As with the previous system, where content owners needed to find their protected material among the thousands of clips added daily, the new system requires content owners to upload their original material into the system to be scanned. For large archives, that can be decades worth of video content.

YouTube Video Identification will help copyright holders identify their works on YouTube. We have worked with Google to develop one-of-a-kind technology that can recognize videos based on a variety of factors. As its Beta status indicates, our Video Identification is brand-new, cutting-edge stuff, so we will be constantly refining and improving it. Early tests with content companies have shown very promising results. As we scale and refine our system, YouTube Video Identification will be available to all kinds of copyright holders all over the world, whether they want their content to appear on YouTube or not.

No matter how accurate the tools get, it is important to remember that no technology can tell legal from infringing material without the cooperation of the content owners themselves. This means that copyright holders who want to use and help us refine our Video ID system will be providing the necessary information to help us recognize their work. We aim to make that process as convenient as possible.

It took a Minnesota jury only 4 hours after 2 days of testimony to find single mother of 2 Jammie Thomas guilty of copyright infringement. She is now responsible for the $222,000 judgment for re-distributing 24 songs.

This, the first RIAA lawsuit to go to trial sets a major precedent for the music industry. Sharing music online is illegal, the law is immutably clear and a jury when presented with proof has no choice but to enforce it.

That said, Thomas’ lawyer Richard Gabriel’s defense: “Someone used her name and IP address—it’s not impossible.” was pretty weak. There are still major challenges to the recording industry to come in the form of the society has changed argument employed by Google, Veoh and DivX that media is being used in fundamentally different ways.

The Purple One, Prince, plans to sue YouTube and other online outlets in an attempt to “reclaim his art on the Internet,” according to a Reuters report.

“YouTube … appear(s) to choose not to filter out the unauthorized music and film content which is core to their business success,” according to a statement.

We couldn’t agree with you more, Prince. We’ve been critical of YouTube in the past for their lack of content filtering, be it copyright material or hate speech. One of these days they are going to get tired of fighting these court battles, and just buy some filtering technology that really works.

What happened to the copyright detection technology that the GooTube announced back in April?
Clearly it isn’t working very well.

Whether or not you believe that all content should be free, the law says it ain’t. The sheer volume of open copyright infringement on video sharing sites is outright appalling.

DivX today filed suit against Universal Music Group, following Veoh’s lead and becoming the latest company to preemptively sue to protect their rights as set forth by the DMCA. The weight these cases will play in the future of media cannot be understated.

DivX has quickly become one of the most widely respected companies in online video, a result of the strength of their codec and their online video site Stage6, which has become of the top 200 sites in the world.

The argument put forth by DivX mirrors that of Google and Veoh: UMG is unfairly targeting DivX. Stage6 is in complete compliance with current laws, and entitled to safe harbor under the DMCA.

Said David Richter, EVP, Corporate Development and Legal:

“We are taking this legal step to protect Stage6 from groundless claims and unreasonable threats brought by UMG. UMG’s pattern of attacking innovative online service providers is discouraging and will ultimately hinder innovation and the development of new technologies”

There is a fundamental transformation that has taken place as a result of the development of digital media and the lower cost of distribution that has resulted. Mainstream media is aggressively defending their cause in this disrupted environment.

The entertainment industry has rallied together, filing briefs in support of lawsuits against Veoh and YouTube. If more new media companies stand up to them, we may well see a turning of the tide in control of media.

While current intellectual property law should not be thrown out, there is a strong case to be made for re-evaluating a segment of the law now filled with gray areas.

The more companies assert their rights in this new media environment, the more visible this debate will become, and the more likely the law will be adjusted to reflect the current state of media and American society.

A month after Veoh preemptively sued Universal for relief against what they felt was an impending suit, Universal has followed through reports Bloomberg, though I can’t find the complaint anywhere online yet.

Yesterday, UMG filed briefs in their defense in the initial suit citing cases againstGrouper Crackle, Bolt (remember them?) and MySpace as precedent for dismissal, stating in a notice:

Specifically, all of these actions involve copyright infringement claims by UMG against defendants’ “user-generated video” websites.

These actions assert that defendants’ websites directly, vicariously and contributorily infringe Plaintiffs’ copyrights by allowing users to upload files containing Plaintiffs’ copyrighted works, copying those works and then facilitating and encouraging further infringement of those works by third parties all over the world.

Let’s hope Eisner still knows some good lawyers from his Disney Days.

Meanwhile, the Veoh blog is down and their PR folks have been working public opinion with a statement saying “It’s unfortunate that UMG prefers to continue their pattern of litigation rather than contribute to the important discussions going on within our industry.”

All posturing aside, this is a discussion that will need to take place in a courtroom sooner or later, and hopefully Veoh will have the balls to fight it there now.

Another reminder of the promotional power of television: after Will Ferrell’s The Landlord was featured on ABC’s iCaught tonight, Funny or Die is the top tracked search on Google, a sign that even Hollywood stars can’t generate nearly the attention online that TV can.

But what’s really interesting is the exploitation of UGC by mainstream media for little if any compensation to the producers. In addition to airing between ads on national TV, videos are re-posted behind pre-roll ads on ABC’s site without attribution to the original creators. (Funny or Die is a rare exception due to their established presence)

This reversal has its roots in the power of mainstream media and their deep pockets to shape what is now a grey legal area in their best interest. In the wake of recent controversy following Viacom’s DMCA action against Christopher Knight, the double standard of Mainstream media using user generated media for profit needs to be re-examined with the public interest in mind.

Two weeks after GoFish terminated their deal to acquire Bolt.com the online video site has shut its doors. Bolt becomes the first, but likely not that last company to disintegrate following a costly settlement with a music company.

At the time of the settlement a Financial Times article noted:

Aaron Cohen, Bolt’s chief executive, said the agreement would allow the companies to work together to create programming and new content tailored to the internet.

So much for that. Bolt is now a smudge on Universal Music Group’s shoe. Another reason to take stock of the divergence of mainstream and social media and the need for new laws that make more sense in the new media environment.

The video below, is a good illustration of why we could use the long tail licensing options I wrote about last week. It’s also an example of a band that wants people to use their music in this way. Harvey Danger released their most recent album under a creative commons license.

Lip Dub - Flagpole Sitta by Harvey Danger from amandalynferri and Vimeo
via Chris Brogan.

Most bands don’t want to prevent their fans from using their music in creative ways but the media environment under the DMCA makes this use impossible to allow.

What is needed is a licensing system that acknowledges the varying degrees of commercial use and charges producers based on these. Those who get 1,000 views online should not be required to pay the same licensing fees as those creating media for TV and film.

The legal structure for long tail licensing is still developing and the court cases being fought by companies like Google and Veoh will play a major role in shaping it. The entertainment industry meanwhile is spending big bucks to maintain the upper hand.

YouTube has formed licensing agreements with Warner, UMG and Sony BMG. And while this seems like it would be great for YouTube users it raises questions about who should pay those license fees and the potential for this alliance to be anticompetitive.

Why for instance, should a user be forced to upload a video including BMG music to YouTube instead of a smaller site which may have better features but doesn’t yet have the traction or money to reach a licensing deal?

As other large internet companies follow Google’s lead and get in bed with entertainment companies there is a growing need for public interest lawyers to get involved to fight for laws that make more sense in the future media environment.

The suit(pdf) filed by video sharing site Veoh against Universal Music Group turns everything around on the traditional system of copyright law.

Veoh’s argument, like Google’s answer to the Viacom suit enters new territory based on theoretical societal changes that have taken place as a result of the democratization of media. Both companies put the onus on the user, and argue that as a result they cannot be held liable.

Google has argued that Viacom’s complaint:

threatens the way hundreds of millions of people legitimately exchange information, news, entertainment and political and artistic expression

The Veoh argument is much more succinct. Veoh is simply an internet “service provider.” They are protected by the Terms of Use all users must agree to prior to uploading content. And because all content is uploaded by third parties who acknowledge they are the rights holders Veoh is not responsible for any infringement.

Veoh claims to have done more than is required under the DMCA, and as a result is seeking relief from a potential future suit UMG has threatened. While the suit is against Universal, if Veoh wins, it would set a precedent protecting them from similar suits by all rights holders whose copyrights have been similarly infringed.

What is so unique about this is that Universal and other copyright holders have for years been comfortable knowing that the high cost and exclusivity of content creation required producers to work with them because of built-in entertainment industry safeguards. Networks and Studios have developed policies requiring all material to be licensed and approved by E&O folks before being distributed to the public.

These safeguards all fell apart once online music distribution and online video came in. The industry responded to this disruption with the DMCA and began sending takedown notices in bulk, paying temps $11 an hour to troll for unlicensed material online. Most of these notices are sent for long tail content which is freely available but rarely viewed.

The problem is that the online video distribution model offers no way to predict whether a piece of content will be viewed 10 times of 10 million times. The amateurs creating 99% of the online video out there are not making any money. Requiring them to pay license fees for something no one views is ludicrous.

Instead what is needed is a system requiring material to be licensed when used by professional new media content producers. The entertainment industry is no longer run only by those with deep pockets. Music and stock footage should be accessible at a reasonable cost to those producing video professionally at all levels.

The entertainment IP licensing firms have had it good for a long time, they can fight it all they want, but sooner or later they too, will need to adjust to the new media environment.