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The rights stuff.


Google Inc. snapped up YouTube Inc. for a tidy $1.65 billion last week, but a gazillion-dollar question still hangs over the acquisition: Will they pay copyright owners to use material or not?

Santa Monica-based intellectual property attorney Lawrence Iser, of Kinsella Weitzman Iser Kump and Aldisert LLP, sums up the issue neatly.

"Are you going to derive revenue from licensing or are you going to derive revenue from litigation?" Iser asks.

Iser points out that You Tube was extremely adroit in announcing newly crafted rights deals with Los Angeles-based Universal Music Group, Sony BMG Music Entertainment and CBS moments before it announced its Google deal.

Iser believes the timing was no accident.

"Google is pretty smart," he said. "Basically, it means that You Tube is following the copyright laws."

He was referring specifically to the Digital Millennium Copyright Act, which Congress enacted to protect new Internet service providers. It provides the right for a provider like You Tube to legally post a video or a song that it doesn't have rights to. If the material's creator or rights holder wants them to take the site down, they need only ask.

Iser's former partner, Aaron Moss, who remains a copyright attorney for Los Angeles-based Greenberg and Glusker, points out that the copyright act, otherwise known as the Safe Harbor Act, will not protect YouTube or Google if it profits from the material, and make no mistake, the plan is to make money.

There's some irony in YouTube, which made its name in part because of its ad-free presentation, merging with the most aggressive of the Internet giants when it comes to advertising.

"I expect it will be a great channel for advertising," said Sergey Brin, Google's cofounder at the conference call announcing the deal. Google said it could insert ads inside the videos as well as serve up text-based ads based on YouTube's search function.

YouTube's Chief Executive Eric Schmidt said that the Google deal "is an exciting next step in terms of our thinking of the evolution of Internet and video." And copyrights, he might have added.

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Title Annotation:TECHNOLOGY; will Google pay copyright owners to use their material
Author:Cox, Dan
Publication:Los Angeles Business Journal
Date:Oct 16, 2006
Words:348
Previous Article:Digital expansion.(TECHNOLOGY)
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