Google: Viacom wanted to buy YouTube, uploaded its own clips

Viacom, which reportedly tried to buy YouTube before Google, seems to want it both ways when it comes to content on YouTube, the video site's chief counsel argued in a blog post today as filings from the legal dispute are unsealed.

As part of its $1 billion copyright infringement lawsuit filed against YouTube, the entertainment giant has suggested in its filings that YouTube looks the other way when it comes to unauthorized videos - such as those owned by Viacom - being uploaded to the video sharing site.

But YouTube argues that Viacom has gone out of its way to upload its content on to the site - sometimes in secretive ways - because it recognizes how valuable the YouTube audience is - and that Viacom has made it difficult, at best, for YouTube to police its content. In his post, YouTube chief counsel Zahavah Levine writes:

For years, Viacom continuously and secretly uploaded its content to YouTube, even while publicly complaining about its presence there. It hired no fewer than 18 different marketing agencies to upload its content to the site. It deliberately "roughed up" the videos to make them look stolen or leaked. It opened YouTube accounts using phony email addresses. It even sent employees to Kinko's to upload clips from computers that couldn't be traced to Viacom. And in an effort to promote its own shows, as a matter of company policy Viacom routinely left up clips from shows that had been uploaded to YouTube by ordinary users. Executives as high up as the president of Comedy Central and the head of MTV Networks felt "very strongly" that clips from shows like The Daily Show and The Colbert Report should remain on YouTube.

Viacom's efforts to disguise its promotional use of YouTube worked so well that even its own employees could not keep track of everything it was posting or leaving up on the site. As a result, on countless occasions Viacom demanded the removal of clips that it had uploaded to YouTube, only to return later to sheepishly ask for their reinstatement. In fact, some of the very clips that Viacom is suing us over were actually uploaded by Viacom itself.

YouTube argues that Viacom's actions make it harder for YouTube to police what's a legitimate upload and what's not. In compliance with the Digital Millennium Copyright Act, YouTube does remove copyrighted material when the copyright holder informs the site of its presence there, Levine said.

So is this just a case of being a sore loser on the part of Viacom for being outbid by Google for the purchase of YouTube? Or did YouTube's founders really look the other way about copyright violations when they launched the site so they to build an audience for it and then sell it, as Viacom has alleged?

CNET's Greg Sandoval, who has been sifting through court documents, found an interesting nugget entered into the record by David King, head of Content Identification System technology that YouTube uses to filter out copyrighted materials. King wrote:

For some of its reference files, Viacom has instructed the site to block, which means take it down and prevent it from going up again. But on others, Viacom has instructed YouTube to leave the clips up and provide the company with information" about how YouTube users are engaging with the matching videos.

YouTube revolutionized online video viewing and, in the process, built an audience that content providers might want to tap into. Plenty of Viacom's content, such as clips from Comedy Central's The Daily Show with Jon Stewart, have appeared on YouTube and received plenty of views. In most cases, a bigger audience would be a good thing for Viacom. But only Viacom should be allowed to decide which clips go up and which don't, the company says.

In Viacom's memorandum, the media company made the following points:

YouTube can't rely on the DMCA as a defense for infringement and the video site took "tens of thousands of videos" from Viacom. The media company relies heavily on MGM vs. Grokster, a case where the Supreme Court found that there was no societal benefit for intentional copyright infringement.

Viacom pushes emails from YouTube and Google executives as proof that there's "a compelling and indisputable record of Defendants' intent to use infringing videos clips to build the YouTube business."

Google turned a blind eye to copyright after a content licensing deal with Viacom fell apart. Viacom said that Google valued such as content license at $590 million. A key excerpt:

Google and YouTube traded off piracy for traffic and in most cases traffic won, said Viacom.

And a post-acquisition "YouTube Content Policy Training" manual even highlighted Viacom's "Daily Show" by name as an example of content to "Approve" when reviewing videos flagged for terms-of-use violations.  Thus, as Google founder Brin had candidly stated during Google's internal debate on this issue a few months earlier, the company was consciously "changing [its] policy to increase traffic knowing beforehand that we'll profit from illegal downloads." This changed only in mid-2008, after Schmidt "shifted his thinking on YouTube's focus," and Google began to use filtering technologies to curtail infringement.

There was a lot of debate about copyright infringement so Google knew what it was doing. From the Viacom memo:

In May 2006, Google held a Google Product Strategy (or "GPS") meeting attended by top executives, including CEO Schmidt. The GPS focused on Google Video. Before the meeting, David Eun, a senior Google executive responsible for negotiating license agreements with content owners, sent an email to Schmidt summarizing the internal "heated debate whether we should relax enforcement of our copyright policies in an effort to stimulate traffic growth" to beat YouTube at its own game.