Goodwill Window Still Open for YouTube

Missing its self-proclaimed deadline to implement its audio anti-piracy software won’t immediately hurt YouTube’s goodwill with the entertainment industry.

As New Year’s Eve approached last weekend, YouTube, which was purchased in October by Google for US$1.65 billion in stock, acknowledged it would not be able to meet its Jan. 1 deadline for rolling out its software, but stated development of the project was “on track.”

The goodwill window will be open a little longer because YouTube is now owned by Google, contended Josh Bernoff, an analyst with Forrester Research. After all, he noted, this is hardly the first time a high-tech company has missed a deadline.

“People are going to be willing to cut Google some slack in terms of implementing this technology,” Bernoff told TechNewsWorld, “but their patience isn’t infinite.

“There’s a strong desire by the media companies to have an answer to this question,” he added. “They’re going to be very difficult to negotiate with until there’s an answer.”

Golden Goose

If YouTube wants to stay on good terms with the content industry, it needs to maintain an image that it’s doing everything it can to fight piracy at its site, argued Joe Laszlo, a senior analyst with JupiterResearch.

“For the time being, more of the big broadcast networks and content owners see YouTube as a net positive,” he told TechNewsWorld.

“At the end of the day, folks like CBS say that the ratings for the ‘Late Show’ went up by 7 percent since they started posting ‘Late Show’ clips on YouTube,” Laszlo continued. “NBC gets amazingly good publicity for SNL [‘Saturday Night Live’] when there’s something funny on SNL because they can post it on YouTube and get a lot of notoriety for it.

“Broadcasters and content owners are getting some benefits from YouTube and hopefully won’t be quick to kill that golden goose, but their patience where piracy is concerned is finite,” he added.

“Is YouTube doomed because they didn’t make their December 31st deadline?” Laszlo asked. “No, but they definitely need to explain to their content partners why this effort is late and when they can reasonably expect it.”

Working With Partners

Attempts by TechNewsWorld to reach YouTube for comment were unavailing. However, the Financial Times reported that a YouTube spokesperson denied the company set a Jan. 1 deadline for delivery of its anti-piracy software.

Although Google’s ownership of YouTube may prolong the patience of copyright holders on the anti-piracy issue, Bernoff suggested that it might be slowing down efforts to get a finished product into the market.

“I think part of what’s happening with this delay is probably some internal discussion about whether Google’s incredibly talented and broad engineering force can figure this out on their own or whether they’re going to have to pay someone who already has a working system,” he said.

However, there is speculation that YouTube is using a partner to develop its software to identify copyrighted audio throughout its Web site.

User Demands

Aside from technology, there are other issues that could be snagging development efforts, added Bernoff.

“If you leave the copyright checking the way it is now — that is, extremely mild, and only take things down when you’re requested — then the copyright holders are unhappy,” he explained.

“If you implement the sort of checking that they have at other sites,” he continued, “then a huge proportion of the interesting stuff on YouTube would be declared illegal, which would put a big dent in usability. The user outcry would be enormous.”

World Beyond Takedown

However, identifying copyrighted material need not be a death knell for user-generated content, argued Vance Ikezoye, CEO of Audible Magic, a maker of music identification software.

“Just because you do identification doesn’t mean you have to take down the content,” he told TechNewsWorld.

Identification can be used to compensate copyright holders when their works are incorporated into user content, he added. “The world is going beyond just taking content down and moving toward facilitating compensation and revenue generation.”

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