YouTube and Google are likely to face law suits from small and independent labels without the negotiating clout of the majors, according to a leading intellectual property law expert. Majors will cut deals now and lobby for a change in the law the expert told OUT-LAW Radio.
"I'm sure that the big content providers will all be queueing up to do deals with Google," said Kim Walker, an intellectual property lawyer with Pinsent Masons, the law firm behind OUT-LAW. "I guess the smaller operators who perhaps haven't got the negotiating clout that Universal and EMI and so on have got I guess if they can't do a deal or don't do a deal they are going to be more likely to look for recompense in some other way by threatening legal proceedings."
Walker was speaking to OUT-LAW Radio, the weekly technology podcast.
YouTube has in recent weeks signed a raft of content deals with major music, television and film companies in a bid to ward off copyright law suits. Warner Brothers, Universal Music, Sony BMG and TV company CBS have all signed deals. But while the big rights holders might cut deals now, Walker believes that lobbying will take place to have the laws changed.
"Effectively YouTube or Google Video has a business model based on allowing material to be up there until someone gets round to complaining and taking it down," said Walker. "I just think the content providers will lobby both in Europe and probably in the US to have the laws tightened so that the notice and take down procedures aren't their sole remedy."
Despite doubts over the commercial future of YouTube because of widespread copyright infringement on the site, Walker says that the company is complying fully with copyright law by taking down material when notified about it.
"If YouTube is asked by content providers to take material down and doesn't do so within a reasonable period then it can certainly be liable for copyright infringement; otherwise it is primarily the user who uploads the material who will be liable," he said, adding that the company is operating entirely legally. "Unfortunately for the content holders that is currently the position."
YouTube was not an attractive target for suits previously because it did not have enormous assets. Google, on the other hand, has a market capitalisation of $130 billion which makes it a much more likely target for suits.
"The US is a pretty litigious place to begin with," said Jordan Rohan, a stock market analyst at RBC Capital Markets. "I think you'll certainly see some lawsuits, that makes sense; that's how the US economy works."