Vivendi's Universal Music Group announced last Friday (November 17) that it is suing MySpace, which is owned by one of the world's largest media conglomerates, News Corporation. The infringement lawsuit is seeking damages of $150,000 per infringing track, audio or video. Let me restate that in proper TMT format: UNIVERSAL MUSIC GROUP, THE LARGEST MUSIC GROUP IN THE WORLD, IS SEEKING DAMAGES OF $150,000 PER TRACK!! AHHH!!!
So let's do some math. According to recent reports, MySpace has an estimated 106 million accounts. To be conservative, let's say only 30% of those accounts are active. Of that 30%, let's estimate a measly 1% of users uploaded one infringing track owned by Universal. If Universal wins this lawsuit, this would mean 318,000 users would cost MySpace $47.7 BILLION. Holy shit!
Obviously what Universal's seeking isn't so much a settlement, but leverage to negotiate. As Jeff Leeds from The New York Times said, "If Universal can win in court, it is likely to gain leverage in negotiating licensing terms with user-driven services — just at the moment that those services are attracting deep-pocketed partners."
Universal isn't sucking up to the user-generated communities in order to get paid; it's using power politics for control. Just last month, Universal chief executive Doug Morris' public condemnation of YouTube helped the group land a sweet licensing deal just before YouTube was sold to Google, and it also recently filed claims against video-sharing sites like Bolt and Grouper Networks. (On a side note, Universal recently worked out a deal with Microsoft to receive $1 for every Zune sold.)
MySpace has already called the litigation "unnecessary" and "meritless," stating that it is in full compliance with the Digital Millennium Copyright Act. Furthermore, MySpace separately announced last Friday that it plans to use a new tool to allow copyright owners like Universal to "flag" copyrighted content, which would then be removed. "We provide users with tools to share their own work — we do not induce, encourage, or condone copyright violation in any way," stated MySpace. What, don't they like confetti!?
In other news, MySpace's content is all produced in sweatshops, but you didn't see that on the political agenda earlier this month, did you? Bullshit I say!