Remember those days when YouTube was "killing" the entertainment industry. You don't even have to look back very far. There are artists who still insist that YouTube is killing
creativity and is nothing but a den of piracy. Viacom spent years trying to argue that YouTube was the equivalent of Napster, but for video, until that lawsuit finally settled
just a few months ago.
However, reality is looking pretty different these days. A couple months ago, Businessweek had a big cover story about how YouTube has become Hollywood's "hit factory"
, and just this week, YouTube revealed that its ContentID program, which allows copyright holders to monetize unauthorized uses of their works, had paid out over $1 billion since its inception
. This isn't to say there aren't problems with ContentID. We've noted in the past the problems
with false flagging, revenue diversion and other issues -- but the simple fact is that it appears to be making money for content creators. Actually, quite a lot of money.
And this brings us back to a key point that we've hit on over and over and over again: given a chance to operate, these business models tend to come about without
the need to pass draconian copyright laws and without
the need to completely takedown and destroy businesses. When allowed to thrive, innovate and experiment, it's only natural that workable business models develop. We've seen it over and over again in the industry. The recording industry insisted radio was going to kill the entire industry -- and then it made the industry into a massive
juggernaut. The movie industry insisted that the VCR would be its "Boston Strangler," but four years later
home video outpaced the box office in generating revenue for the studios.
The continuous claims of "Hollywood vs. Silicon Valley" on copyright issues is so clearly bogus. As we've argued for years, it's the innovations of the tech industry that keep saving
the entertainment industry over and over and over again. There's no "war" between the two when it appears that Silicon Valley is the one supplying the "weapons" that's making Hollywood very, very wealthy
But when will those folks in Hollywood learn this? Instead, they keep attacking these new services, demanding more copyright "enforcement" and blocking these forms of innovation. Who knows what other innovations might have occurred had the industry not shut down Veoh
. Or Grokster
. Before the US government completely shut down Megaupload, it was experimenting with new revenue models were attracting the interest of lots of famous musicians
. Imagine if that had been allowed to continue. Who knows what other kinds of cool business models would be in place today making more money for artists.
Attacking innovation seems to be the legacy entertainment industry's default position, no matter how many times that innovation actually opens up new markets, provides new revenue streams and makes pretty much everyone better off. Oh, except some of the gatekeepers. Those guys tend not to be able to keep quite as much of the revenue generated by these new platforms. And maybe, just maybe, that's the real reason they're so angry about innovation.