Given my posts on Viacom’s $1bn Google/YouTube lawsuit, it’s no surprise that I was in a legal state of mind this week and that the news that caught my attention typically had some legal aspect to it.
After all the drama, Carl Icahn’s proxy battle to replace Yahoo’s board of directors turned out to be short-lived, and ended with a whimper, not a bang.
On Monday, Icahn and Yahoo announced a settlement; Icahn will join Yahoo’s board and two new members will be added from Icahn’s original slate.
It remains to be seen whether or not Icahn’s presence on the Yahoo board will assist Microsoft in completing a transaction with Yahoo.
In a statement, Icahn left quite a bit of wiggle-room:
“While I continue to believe that the sale of the whole company or the sale of its search business in the right transaction must be given full consideration, I share the view that Yahoo’s valuable collection of assets positions it well to continue expanding its online leadership and enhancing returns to stockholders.”
While I don’t question that Yahoo’s assets are impressive; given that CEO Jerry Yang and all but one of the current board members will be sticking around, “enhancing returns to stockholders” will likely remain a challenge in my opinion.
The company’s disappointing quarterly results, although almost certainly impacted by the uncertainty created by Microsoft’s bid, doesn’t give much hope to investors hoping to see evidence of some turnaround sooner than later.
Just as I have previously, Viacom’s Philippe Dauman dismissed any notion that content has been commoditized while speaking at the Fortune Brainstorm Tech conference this week.
“If you have a great brand supported by great content, there has never been a better time to reach more consumers, and reach them in a much deeper way than you ever could.”
Most interestingly, as reported by News.com, when Vint Cerf, the ‘chief internet evangelist’ for Google, asked “whether content and distribution of content will be separate going forward,” Dauman explained that Viacom is a content producer and not a distributor. Even its cable channels are “distributed” by others.
Although copyright infringement apologists have lambasted Viacom for its $1bn lawsuit against Google, as I’ve pointed out before, Viacom has been at the forefront of distributing its content online.
Its Comedy Central website, for instance, provides free content from popular programs such as the Daily Show and Colbert Report and it has done distribution deals with the creators of South Park and online services such as Hulu.
When it comes to new technologies, Viacom is going beyond the repurposing of its cable content. As Dauman noted:
“We don’t just reproduce content for (other channels), we create special content for wireless and Internet.“
Given the popularity of Viacom’s content (more than 150,000 unauthorized video clips, generating more than 1bn views on YouTube alone), it’s hard to disagree that content is still king.
The only question for executives like Dauman is:
“Can we keep thieves out of the castle?“
Mark Zuckerberg used his keynote at the second annual Facebook developers conference to make some zany comparisons about Facebook applications.
But for one prominent Facebook developer, Facebook’s hyped applications platform has led to a potentially significant legal problem.
Brothers Rajat and Jayant Agarwalla and their company RJ Softwares, based in India, created the popular Scrabulous Facebook application that allows Facebook users to play the famous board game online.
Hundreds of thousands of Facebook users use it everyday and the Agarwallas have leveraged its popularity to reportedly generate upwards of $25,000/month in revenue from advertising.
There’s only one problem. The Agarwallas never received permission to create Scrabulous, admitting that they launched “without thinking through the legal aspect at the time.“
Hasbro, which owns the rights to Scrabble in the United States, hasn’t been too pleased and after a cease and desist, some posturing and negotiating and the launch of an official Facebook application for Scrabble, Hasbro has filed a lawsuit in the U.S. District Court in New York accusing the Agarwallas and their company of copyright and trademark infringement.
Interestingly, Facebook is perhaps the party with the most to lose in the situation.
While Facebook is not (yet?) named in the lawsuit, Hasbro issued a statement that contained a vague warning:
“We expect the full cooperation of Facebook in this matter.”
Facebook issued a limited statement of its own:
“Over the past year, Facebook has tried to use its status as neutral platform provider to help the parties come to an amicable agreement. We’re disappointed that Hasbro has sought to draw us into their dispute.”
It’s a curious position. After all, Facebook put itself in the middle of the dispute by trying to “help the parties come to an amicable agreement.“
As the AP’s Anick Jesdanun observes:
“By waiting, Facebook risks losing immunity protection from copyright lawsuits. Under federal law, service providers are generally exempt for their users’ actions — at least until they become aware of a specific infringement.”
This seems possible.
Where Facebook got the notion that it should try to arbitrate intellectual property disputes and help third parties reach “amicable” agreements over such matters is beyond me.
Perhaps it needs to spend some of is money on more/better attorneys.
How to stem the tide of illegal downloads? The UK’s six largest ISPs are participating in a government-sponsored campaign that will see letters sent to subscribers who are found to be downloading pirated content.
These letters will warn pirate subscribers that their online activities are being monitored.
It is not yet clear what consequences may be established for habitual infringers, but legislation that would require the disconnection of subscribers or an additional fee is possible.
Reportedly, the ISPs involved in this campaign will be developing legal alternatives so that their subscribers aren’t “forced” into a life of piracy.
Frankly, I think it is sad that the situation has become so out-of-control that such a campaign is required, and restrictive legislation will probably be implemented at some point.
But as I have said – consumers will reap what they sow. A variety of special interests (and not all related to the record and motion picture industries) will seize the opportunity to use the online piracy “pandemic” to create a Big Brother internet.
Unfortunately, it appears that consumers were willing to trade their privacy for some music and movies.