Universal Music Group, the biggest record label in the world, is suddenly getting heavy with both DivX and Veoh, and their user generated video businesses. DivX uses its technology to support Stage6, a UGC site.
DivX responded to comments from UMG issued to the press, and issued its own suit requesting a court to make it clear that it is not infringing UMG copyright, while UMG has actually issued a suit again Veoh alleging that it is a ‘mass infringer,’ and saying that ‘Veoh’s rampant infringement will not stop until Veoh, and those who own, control, and run it, are enjoined and held financially responsible.’
Veoh backers include Time Warner and the investment company of Michael Eisner, the previous CEO of Disney, through his Tornante investment company. Last month, in a move rather similar to the DivX move, Veoh sought a court order saying that it is not infringing Universal copyrights, because it’s not responsible for illegal postings by users.
Both companies say that they act promptly on ‘teardown notices’ issued under the auspices of the Digital Millenium Copyright Act, and either block offenders that load copyrighted materials or block identical files from being loaded again.
DivX’s Stage6 video hosting service is its answer to YouTube, using the DivX codecs instead of rival’s On2 Technologies, which is used in Adobe Flash video. Ars Technica reports that Universal has told DivX that the site is “knowingly involved in the infringement of UMG’s copyrighted materials, and exploits that widespread infringement for its own commercial gain.”
Universal Music Group has made a swathe of legal threats and a year ago it cut a deal with YouTube, based on its threatening posture. It went on to take on News Corp’s social networking site MySpace, which responded by bringing in technology to block illegal copyrighted music and then video, using audio fingerprinting
Google’s YouTube has been famously charged in much the same way by Viacom which says it purposely and knowingly allowed Internet users to illegally post Viacom shows like “South Park” and “SpongeBob SquarePants” on its YouTube video site, and seeks $1 billion recompense.
Both DivX and Veoh believe that UMG uses law suits as a form of persuasion for conducting business, and that it is seeking yet another windfall share of their revenues, if not a shareholding. UMG acknowledges that it is in talks with DivX.
On the other side of the equation sending literally thousands of legitimate DMCA takedown notices uses up a lot of time and money for copyright holders, and the DMCA legislation will come under pressure for a re-write or re-interpretation, if the large content owners cannot work the system more easily.