YouTube Fight Is Viacom's Iraq

It's just traditional media companies being traditional media companies.

Viacom and its subsidiaries like CBS, Comedy Central, etc are simply acting like Universal's NBC and Disney's ABC. They have "Seen-us envy" -- that disease that has old media companies becoming paranoid because the audience gets to see their content, they even get paid, but they can't control the distribution.

So, Viacom let the other shoe drop yesterday in Federal Court suing Google over YouTube for more than $1 billion in damages. This suit makes Clear Channel look like a nickel and dime litigator. Viacom is becoming the new Clear Channel while Clear Channel which put off a shareholder vote on taking the company private must be abiding by less is more in the lawsuit department. (By the way, do you think a company postpones a shareholder vote if they think they have enough votes to approve? Just asking.)

Back to Viacom.

Google is not intimated by the lawsuit. Google prints money -- lots of it and even though it has had some lousy ideas like selling TV, radio and print time like a commodity, it is one of the few new age media companies that still lives in the future. Viacom, on the other hand, is a prehistoric entity using its might and the courts to enter into a battle to save itself and the industry from those insurgents who would threaten democracy as we know it in the media world.

In short, the $1 billion Google lawsuit is Viacom's Iraq. A no-win war that squanders time and money. The battle keeps them unfocused and unable to fully concentrate on little things such as their digital future.

Viacom will lose this war.

The burden of proof is high. It has to convince the federal court in the Southern District of New York that its rights and ability to profit from time sensitive material like "The Daily Show" have been detrimentally impaired by appearing on You Tube.

Most of you know YouTube takes content down when requested. Viacom wants it to be automatic. There is law that appears to give YouTube the benefit of the doubt as to whether removing content when asked is enough.

Some people believe Viacom is just bluffing.

The thinking of Bob Peck, a Bear Stearns analyst, was attributed in yesterday's Wall Street Journal article saying "the lawsuit is likely a negotiating tactic aimed at pushing talks forward on better terms for Viacom" in doing a financial deal with Google. That's how big media companies work -- sue 'em and soften them up.

Google pays compensation to others. The BBC just did a content deal. Google had even been negotiating with Viacom until the talks broke off. At least Viacom is willing to sit down and negotiate face-to-face with the "enemy".

So this is now war.

Viacom unleashes its troops (the lawyers).

Asks Congress (Sumner Redstone) for funding.

Gets the generals (company heads) on the field to play nice and win one for the company.

But the insurgents don't use roadside bombs, they use the power of the people who support free expression and distribution on the Internets (as President Bush would call it). These radicals are not so destructive as to think that the video clips should be stolen. No, they are willing to pay handsomely -- just not as handsomely as the Great Satan (Viacom) wants.

They'll battle in court. Lose valuable time fighting terrorism (cable system fee hikes, etc) on other fronts while they spend feverishly on their obsession of "fighting them there (in court) so they don't have to fight them here (in the marketplace)".

Both sides will get nicked. Wills will be tested. The money -- whose counting?

In the end after much time and expense, neither side will allow a Federal judge to rule on this matter. Neither side is that stupid.

So, welcome to "America's Funniest Video Screwups" -- the show that asks the question how dumb do you have to be to spend years fighting over what is not a winable war.

No, I'm not talking about Iraq here -- although if the shoe fits go ahead and wear it.

I'm talking about the digital future.

Viacom may not like what the Internet has done to them but the sooner they get real (get back to producing content) the sooner they will find the compensation they deserve in a digital world.

Record labels, radio, television, newspapers and soon the movie industry are being rocked by the realization that it would be far better to send your assets to Afghanistan (Internet) to fight terrorists (those who would do anything to upset traditional media's status quo) than join other nations (new and existing media companies) in rearranging their digital futures.

See what I mean, YouTube is Viacom's Iraq?

No one can win this war and fighting them there doesn't make the digital future any safer for a traditional media company here.