The judge who today threw out Viacom’s $1bn copyright infringement lawsuit against YouTube may just have given the video site the final lift it needs to reach profitability.
That is the less-noted result of judge Louis Stanton’s decision to grant a motion for summary judgment in the case. The reason: he has given YouTube an emphatic green light to start placing adverts against a much wider range of videos on its site.
It’s noteworthy that the judge believes that YouTube was well aware of illegal uploading. From his ruling:
A jury could find that the defendants not only were generally aware of, but welcomed, copyright-infringing material being placed on their website.
That became apparent from evidence in the case that was unsealed three months ago. At the time it led me to conclude – wrongly, as it now turns out – that YouTube would find it far harder to resist Viacom’s claims.
But in order to prevail, according to judge Stanton, Viacom would have had to show that YouTube had specific knowledge of individual acts of infringement – and then failed to remove those clips from its site.
While the case was unresolved, YouTube took a conservative approach to where it placed adverts, limiting them to videos covered by agreements with content owners. A large portion of its site went un-monetised.
Judge Stanton explicitly concludes, however, that YouTube need not worry about placing advertisements on copyright-infringing content by mistake, just as long as it doesn’t have specific knowledge of the infringements.
When I asked Kent Walker, Google’s general counsel, about whether this opened the way to wider use of advertising, he ducked behind a lawyerly response: “It’s too soon for us to venture an opinion.”
But the implications are clear. In January, Eric Schmidt told the FT he believed YouTube could reach profitability this year. A significant remaining obstacle has been removed.
