The public interest in downloading video just gets stronger and stronger. According to a study released last week by Adams Media Research, annual consumer spending on Internet downloads of movies and TV shows will top $4B in 2011, up from just $111M last year.

Aldo Cugnini
Analyst

At the center of all this is copyright law. But the laws are only slowly evolving - driven from one end by technology and consumer demand, and slowed at the other by the inertial forces of legacy business interests. Some recent events are clearly pushing the envelope defining the legal rights owned by copyright holders - and how video material may or may not ultimately be used. As many observers have noted, a new business model that encourages the distribution of content is long overdue. But how to implement a system that protects the content owners, benefits consumers, and feeds a profitable business? That is the magic egg.

This past month, both YouTube and rival MySpace announced plans to introduce technology to help media companies identify pirated videos uploaded by users. But content providers such as Viacom are slamming YouTube’s strategy of offering content protection as part of broader negotiations on licensing deals. They called the proposition unacceptable, saying that YouTube "will only protect copyrighted content if there’s a business deal in place."

Other critics have likened YouTube’s tactic to a "mafia shakedown." Adding to the business challenge is the fact that clips with claimed ownership by one party could in fact contain material produced by another. This led a YouTube spokesperson to say, "These matters are very complicated and we are working with our partners to identify and solve these problems."

Further evidence of business difficulties emerged this month, as the much-ballyhooed talks between CBS and YouTube have apparently broken down.  According to Reuters and The Wall Street Journal, the two companies had been closing in on a multi-year deal, but could not agree on issues such as how long the deal would run.  Other companies, including Viacom, News Corp. and NBC Universal have also apparently discussed launching their own versions of YouTube - perhaps even as joint venture - but industry sources have said that differing interests have stalled plans.

Legislators are having an increasingly difficult time sorting out the vagaries of content ownership, too.  Earlier this month, overzealous pols accused House Speaker Nancy Pelosi of pirating 16 copyrighted clips of House floor debate from the cable and satellite network C-Span, by including them on her new blog, The Gavel.  In fact, House and Senate floor debates are "government works," shot by government-owned cameras, and are thus in the public domain, a point made by C-Span itself.  Notwithstanding this incident, C-Span later noted that Pelosi’s blog also contained a different clip owned by C-Span, as it was shot by their cameras at a House Science and Technology Committee hearing.  (The blog has since substituted the clips with government-shot material.)

Some cable operators are taking a different tack to protecting their content - by not letting the viewer "hold" it in the first place.  Comcast and Time Warner Cable are but two of various cable operators now experimenting with "time-shifted TV," i.e., a PVR-like experience without the PVR.   By putting the video cache at a location outside the viewer’s home - such as at the curb, or at the cable headend - the networks hope to provide an experience every bit as engaging as "TiVo" but with more content control and lower equipment deployment costs. 

From as far back as Gutenberg, the citizen and the media have struggled with these ownership and fair use issues. "Content is king," as they say, but of what domain?