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Data in Google Anti-Piracy Report Shows Promise of “DMCA-Plus”

This morning Google released an updated “How Google Fights Piracy” report, an extensive survey of how assorted Google products, including YouTube, fight intellectual property rights infringement.  Building on a previous report in 2014, the 60-page document details how rightsholders can use tools to control or monetize unauthorized activities online in relation to search, YouTube, Google’s Play Store, and advertising.

Initial coverage focused on the report having revealed that YouTube has paid over $3 billion dollars to music industry stakeholders, labeling this a “rapid, significant increase” over payments in 2014.  

This comes at a time when the video hosting platform is under pressure to pay out more in licensing negotiations. The report also notes that YouTube’s Content ID system alone has produced $2 billion for partners.  In addition to framing the debate over private licensing arrangements, these data points highlight the absurdity of misrepresentations earlier this summer that musicians were receiving more money from vinyl records than streaming.  These data points also underscore the scope of opportunity as players in the highly competitive video platform industry jockey for a growing pool of industrially-financed and individual creator content.  

The impressive returns from Content ID reflect the economic significance of so-called “DMCA-Plus” systems like Content ID.  While most online platforms comply with the 1998 Digital Millennium Copyright Act (DMCA) “notice-and-takedown” system, some more sophisticated platforms have gone above and beyond what the DMCA requires.  These approaches are sometimes referred to as “DMCA-Plus” to indicate that online services perform additional services for rightsholders, beyond simple DMCA compliance.  

These contractual “super-structures” built on top of DMCA compliance programs can provide new licensing opportunities for rightsholders.  Today’s report points out that some 90% of copyright claims on YouTube result in monetization, such that half of the music industry’s YouTube revenues derive from claimed content.  In short, as DMCA-Plus systems expand across the economy, rightsholders may be poised to receive billions in royalties.  

As this market grows, so too does the incentive to misuse these DMCA-Plus tools.  Pages 45-46 of the report note several egregious examples of DMCA abuse by those seeking to suppress information or competitors.  As previous DisCo coverage has noted, such problems have already been extensively documented.  With more and more money on the table from DMCA-Plus systems like Content ID, the need for meaningful penalties for abusive takedown claims will only grow.

Nevertheless, the challenges posed by abusive takedowns are one discrete challenge in the broader context of an entirely new revenue stream for creative industries, one which could not exist but for the DMCA.  

Intellectual Property

The Internet enables the free exchange of ideas and content that, in turn, promote creativity, commerce, and innovation. However, a balanced approach to copyright, trademarks, and patents is critical to this creative and entrepreneurial spirit the Internet has fostered. Consequently, it is our belief that the intellectual property system should encourage innovation, while not impeding new business models and open-source developments.