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Reason Foundation

Viacom calls out Google

Steven Titch
February 4, 2007, 7:16pm

You've got to admire Google for its consistency. Its idea of the Internet business model is, "Anything of yours I can use to bolster my bottom line should be free." It disguises its tactics through dazzle, hype and self-promotion, wherein it fashions itself at the vanguard of the business disruption and upheaval brought on by the Internet. The old rules don't apply, Google tells us. And we're the ones making the new ones. Except when powerful interests roar back. And so, to avoid a lawsuit, Google has agreed to take down some 100,000 unauthorized video clips belonging to Viacom from its YouTube site. Viacom's holdings include Paramount, MTV, and Comedy Central. The two companies could not come to an agreement over licensing the material. Google claims to be chagrined, asserting that Viacom doesn't know a good thing when it sees it. But Google's claims that YouTube promotes Viacom's content by increasing its visibility didn't wash. Viacom said it did not find any evidence that YouTube postings contributed anything additional value to Viacom's products. "YouTube and Google retain all of the revenue generated from this practice, without extending fair compensation to the people who have expended all of the effort and cost to create it," Viacom said in a statement reported in the San Francisco Chronicle. This appears to be a troubling trend at Google. It's the same tack the company took with publishers who have demanded royalties for participation in the sweeping Google Print project. Google Print aims to build a massive literary search engine--to use as a platform for commercial advertising sales--by scanning the contents of every printed work. Just as did with Viacom, Google is trying to tell copyright owners–and copyright lawyers and judges--that they just don't "get" the Internet model, that they are too concerned with protecting "old business models," and that demanding a sexy, bleeding-edge 'Net pioneer like Google (market cap: $143b) actually pay them for commercial use of their property is not in the publishers' best interests. And like Viacom, publishers aren't buying it. Google is pulling the same thing with network neutrality. Internet service providers who say they have a right to collect fees from Google for prioritizing delivery of its commercial services are labeled monopolists trying to cling to a dying business model. With that reasoning, and little else, Google is aggressively lobbying Congress to prohibit service providers from charging large Web hosts like itself for the additional quality, reliability and partitioning resources their services and applications will need as they cross the network. It's pretty much been established point of law that you simply can't appropriate someone's property for your own financial gain. The disconcerting aspect is that many otherwise sensible people who world never buy this if applied to brick-and-mortar commerce, are taken in when it's applied to the on-line world. Google's founders may indeed be business wizards, but there best trick is, by reciting the incantion, "The Internet changes everything," how they get lawmakers and media to forget basic property rights and contract law.


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