Why Mark Cuban is still wrong on YouTube

Mark, who wrote just days before the Google-YouTube deal that only a moron would buy YouTube (which I responded to here), just can’t seem to let go of his view that Google bought themselves a world of copyright pain when they did the $1.6-billion deal for the video-sharing site. But copyright experts disagree — in fact, they say, Google is in pretty good shape. But isn’t YouTube just like the video version of Napster, and bound to be crushed by lawsuits? Well, no.

At least, not according to Tim Wu, a law professor at Columbia University who specializes in copyright law. In a piece at Slate, he writes that YouTube

is in much better legal shape than anyone seems to want to accept. The site enjoys a strong legal “safe harbor,” a law largely respected by the television and film industries for the choices it gives them.


The ironic part, as the piece goes on to note, is that what protects YouTube and Google — a clause U.S. Copyright Code known as Section 512, also known as the “safe harbor” clause — was fought for and ultimately won by the big U.S. telecommunications companies. Yes, the same ones that are fighting Google over who should pay for all the video and other bandwidth-hogging content that is (allegedly) filling up their pipes.

All this clause requires YouTube to do is to take down videos when a copyright holder notifies them that their rights are being infringed on. And as Prof. Wu also points out, some content owners actually like the flexibility that 512 gives them — if they want a viral video to do some free marketing for them, they can leave it up. Once they are done with it, they can send YouTube a letter to take it down. The best of both worlds. And once again, I find that Mike Masnick of Techdirt and I are on the same wavelength.


My friend Rob Hyndman takes issue with some of Tim’s points in the comments section of this post, and also has a back-and-forth with Mike over at Techdirt in his comments section (Rob, you really need to get more sleep, buddy). His point is that YouTube has to be aware that there’s a ton of infringing content, and since it makes money from that content then it may be weakening or even removing its safe harbour protection. That seems to me to be something that will only be conclusively resolved if and when YouTube goes to court — and perhaps not even then.

8 thoughts on “Why Mark Cuban is still wrong on YouTube

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  2. In order to benefit from the safe harbor the provider must have no knowledge of, or financial benefit from, the infringing activity. Tim skirts around this, mentioning only: “Of course, as with any law, YouTube’s legal status might not be 100-percent airtight. The law suggests (in §512(c)(1)(A)(ii)) that YouTube might be liable if, in the absence of notice, it is “aware of facts or circumstances from which infringing activity is apparent.”

    (You tell me – is YouTube aware? Or rather, is anyone on the planet unaware?) The issue for YT is how it monetizes content from which it is not permitted to derive financial benefit if it is to get the benefit of the safe harbor. So far, all of the commentators I’ve read have sidestepped that issue, which is the nub of the issue.

    Tim’s article is nice history, but it’s nothing new – there have been lots of pieces like it – and it doesn’t address the central question of how Google can financially exploit this asset and stay on the right side of the safe harbor.

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  4. Mathew – see the discussion over at Techdirt, where Mike and I had a little back and forth in the wee hours last night. Though I think they might have been a little more wee for him. (I can’t believe the quantity of theiir output, actually.)

  5. Well, Rob, Mike beat me to it — because I was going to make exactly the same point he did in his response to your comment at Techdirt.

    According to Fred Von Lohmann of the EFF, who has been having the same back and forth over this with Mark Cuban on the Pho mailing list, it isn’t enough that YouTube knows *in general* that there is infringing activity. It has to be made specifically aware — i.e., through a notice-and-takedown letter.

    As far as I can tell from his comments, simply deriving revenue from the content isn’t enough to remove the safe harbour protection either. Your point to Mike over at Techdirt about how much of YouTube’s content is infringing may come into play in a court case, but so far it isn’t clear how much is too much or how much awareness is enough to lose the safe harbour.

    But at least you can take comfort in the knowledge that Mark Cuban is upholding your side of the argument 🙂

  6. I’ve been following Fred’s comments as well. Trouble of course is that that’s what Fred wants the answer to be, as far as I can tell. So I’m still dubious that his comments are balanced. The obvious problem is the scope. As a practical matter, it’s hard to see how it can be said to be appropriate to allow wholesale copying for profit. This is justified on the basis that it’s more efficient to cause rightsholders to issue notices than it is for service providers to monitor content. If there is little infringing content, that may be so – needle in a haystack, etc. But if it’s more, it seems to me the argument is quite different.

    To relate it back to Tim Wu’s piece on history, innoculating an ISP for incidental infringements committed on its network is one thing. But allowing a service provider like YT to build a for-profit business model substantially off of infringement is quite another.

    One other point I made by email to Mike – I’ve heard it said by several US commentators now that the DMCA safe harbor is not available to Grokster-type liability. That is, a site like YT would be exposed to claims of direct infringement, which could be entitled to the safe harbour as we’ve been discussing here and over at Techdirt, and the so-called “active inducement” infringement liability that was at issue in the Grokster case, which I’ve read is not subject to the safe harbour. I’m not certain whether this is the case (I only play a US copyright lawyer on TV), but more to the point, it has fallen off the map in any discussions about this since shortly after the Grokster decision was issued – all of the debate since then that I’ve seen has been about the DMCA issues.

    Last point – have you noticed that company side lawyers are absent from these debates? I think they’ve learned that it makes no sense to engage with a community that is most interested in the warm glow of agreeing with itself. And I suspect they’re keeping their power dry until their clients decide what to do. This is in marked contrast to the early Napster days, when opinions were flying fast and furious on both sides of the debate. Also, we now have much better developed grassroots organizations like the EFF, and media access for them through outlets like Boing Boing, to circumvent the MSM, which perhaps did not give that voice enough profile in the Napster days.

    It makes a difference.

  7. I’m rapidly getting out of my depth legally-speaking (if I wasn’t already, that is) but I think you are right about the key issue — ast least as far as the courts are concerned, post-Grokster — being “active inducement.” How that gets defined is one of the big question marks for YouTube, I think. Another big question mark, related to your comment about a business model substantially based on infringement, is what the term “substantially” means.

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