What the Veoh Decision Means for YouTube and Others

Nice post this morning tracing out the implications of a recent California district court decision on a case in which internet video site Veoh was sued by a porn company for hosting material that infringed on that company's copyrights:

http://www.techcrunch.com/2008/08/28/what-the-veoh-decision-means-for-youtube-and-others/

In a nutshell, Veoh received DMCA notices from IO Company, the purveyor of porn, and complied with them, but ended up in court anyway. IO Company was arguing that Veoh, by automatically transcoding user-uploaded videos into Flash video format, had taken over control of the content and thus enjoyed no safe-harbor provisions under the existing laws. The court disagreed.

Obviously this is a very promising sign for YouTube, which is still fighting it out with Viacom over what the latter claims to be a $1 billion copyright infringement. There are many appeals still to come, and with this much money on the table, sooner or later the Supreme Court will be asked to weigh in on the issue. But even beyond the arena of internet video, this was a case which could have had a tremendously chilling effect on all community-oriented sites. Among other things, IO Company was arguing that providers should:

1. Individually inspect every piece of uploaded content and verify that it was not in violation of copyright, regardless of whether the holder of the copyright had contacted them with a complaint. Presumably the provider would be using some sort of magic copyright database by which to identify all such cases of infringement.
2. Ban the IP of all infringers, even if that would have the side-effect of banning a bunch of innocent members as well.

Now, it's obvious that IO Company was just looking for some free money in this case. But the consequences of them winning on such an argument would have been tremendously negative. If every site was held liable for every action of its users, even if it made a good-faith effort to keep things on the up-and-up, then any business with a website that allows community interaction would operate within a precarious legal landscape.

So, it's not a total win, but it's a step in the direction of sanity, and that's a good thing.