Last month, after failed negotiations, Viacom ordered YouTube to remove more than 100,000 clips containing Viacom content from its site, and said it would launch its own video site with a bunch of copycat features (usability not being one of them). Apparently Viacom's figured out that paying for all that bandwidth might get expensive, as it's now sued YouTube and Google for $1 billion, and it's seeking an injunction against the site. Viacom contends YouTube's business model is "illegal" and that it's intentionally infringed the company's copyright, saying that more than 160,000 unauthorized clips have been available on YouTube, and viewed more than 1.5 billion times. The suit illustrates Viacom's misunderstanding of the web and YouTube: its claim for $1 billion essentially says that's the amount of money it thinks it's missed out on because of YouTube (just to put it in perspective, Viacom's 2006 revenues were $11.5 billion). That's pretty ridiculous, and should Viacom's own video site ever become popular enough to deliver similar viewer stats, the revenues it generates will underline that. What's more likely to damage Viacom's business is removing the clips from YouTube, since it offers a free promotional outlet -- something other broadcasters have noticed -- that may not directly generate revenue for the company, but indirectly drives viewers to its revenue-generating products. Update: Over at NewTeeVee, Liz Gannes takes a look at the numbers, while on IP Democracy, Cynthia Brumfield has examined the suit and calls it "fluffy", noting it never even cites the DMCA, which one would imagine would be particularly relevant here.
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