Jason Calacanis, the guy who uses a bulldog for his avatar, the guy who started the blogging network containing Engadget that sold to AOL for millions, doesn’t think YouTube is a real business:

YouTube and other video hosting sites have made it easy to pirate stuff on the web (which is where piracy started), but they shouldn’t be positioned as some revolutionary business. It’s a silly, little business that anyone could setup in a week. The fact that folks are talking about them being bought for some large amount of money by Newscorp is commical.

His misspelling of ‘comical’ aside (maybe he was thinking community?), Mr. Calacanis also pointed out that the pirated Saturday Night Live video came from YouTube. That post railed against the service too.

Before I weigh in with my own opinion, let me state up front that I don’t use, am not registered, and have spent only a few minutes at the YouTube site. For all I know, the vast majority of their content is in fact user-driven and published completely with the copyright owner’s permission. I have tried Google Video which also lets you upload content, and despite having stringent policies against uploading copyrighted content, some DMCA violations are still getting through. It isn’t easy preventing hundreds of users from uploading violated content, much less hundreds of thousands or millions.

I’m sort of surprised that it took NBC so long to go after YouTube for the DMCA violation but the more disturbing part of this is why didn’t YouTube take down this copyrighted content when they knew they had no permission to have it on their servers and display it to others?

Their official response on the YouTube blog (Feb 16, 2006) rings hollow to me:

Hi Tubers! NBC recently contacted YouTube and asked us to remove Saturday Night Live’s “Lazy Sunday: Chronicles of Narnia” video. We know how popular that video is but YouTube respects the rights of copyright holders. You can still watch SNL’s “Lazy Sunday” video for free on NBC’s website.

YouTube is a business, but it’s not a legitimate business model. If they can’t make it work solely on content created and shared by users and need to piggyback on Saturday Night Live and other copyrighted content used without permission, only taking it down when their hand is forced, then somebody needs to shut them down, not prop them up.

You don’t steal something and then give it back when the person you stole it from complains and say, sorry, “we respect the rights of copyright holders.” If they really respected the rights they would have taken it down as soon as they realized it had gotten onto their servers. They didn’t. Despite Calacanis saying something about it and getting a bunch of pirate-hungry traffic.

We cannot put all the blame on the users on this one nor more than the users should be blamed for the original Napster being a breeding ground for piracy. Look, I like the price free too, but honest free, not dishonest free. Not when it comes down to stealing. If Saturday Night Live didn’t give YouTube the permission to distribute that video, then they should have taken it down. Now one counter argument might be that Saturday Night Live should have given YouTube permission once it was clear that the video was helping them but if they do it for them, then does that mean that any YouTube-clone site can go out there and do the same thing hoping they’ll get permission from the copyright owner after the fact?

This reminds me of the way some of these mashup sites that are scraping pages without permission. It happened with Craigslist and some of the pushback suggested that just because it was on the web meant it was freely available to be used. No, just because it’s on the web doesn’t mean it’s ok to scrape it and use it elsewhere, for free, for profit or for any reason. Just because it is in a full text RSS feed doesn’t mean it is for the taking either.

What others are saying
Eric Schonfeld is “… a bit surprised by this move.” He is in the camp that thinks the publicity was good for NBC. Nevermind the fact that nobody bothered to ask NBC for permission beforehand.
Don Dodge, formerly VP of product development for the original Napster writes: “If YouTube can stay out of court, screen content appropriately, build its user base, and attract advertisers, they will have a very nice business.”
Paul Kedrosky challenges Jason’s claim that a YouTube clone could be built in five days. In the comments Calacanis adds that five days for the basic structure, a month so it scales up to the 50TB/day of traffic that YouTube is pumping.
Kent Newsome: “So these may or may not be real businesses, but just like “strange women lyin’ in ponds distributin’ swords is no basis for a system of government,” the possibility of a pirated file is no basis for deciding that something isn’t a real business.”
Ben Barren: “YouTube is a business in the same way Skype is a business, in that it’s another cut into a large industry. It’s valuation as a business, assuming it keeps it’s growth rates up user wise, will depend on whether someone wants to punt on its commercialisation.”
J. Botter: “Jason’s one of my heroes in the publishing business, and I’m going to have to back him up on this one. You Tube is nothing more than drug dealers making it easy for the masses to pirate video and audio and make it available across this spectrum.” Drug dealers? I’m not sure I’d go that far, but curious analogy.
Venture Capitalist, Fred writes: “Let me break it down for you Jason. Youtube is as much a business as MySpace or Digg which you cite as real businesses in your post … I am rooting for them because I love the service as a consumer.”
Om Malik: “I believe that the growing popularity of You Tube (and other online video sites… about 95 in total as per Mary Hodder of Dabble) has less to do with amateur content, and more to do with copyright infringing content.”
Mathew Ingram: “What seems to have escaped the network’s mind is the fact that the video already aired on the program, and therefore has made as much revenue as any episode of the show normally does, not to mention the fact that the attention the video got could drive thousands more people to watch future shows.”

My thoughts
I realize it takes manpower to police the actions of users, but it’s not impossible. If you setup a service that allows users to upload or copy/paste anything — pictures, videos, text — you have an inherent responsibility to police the content and make sure no DMCA violations occur. When/if they do, you need to act promptly and not hope that the popularity of the copyright infringement extorts copyright holder into submission. If you don’t, then your business (loosely defined) is just as Jason Calacanis is calling out: a heaven for pirates.

If YouTube is none of the things that Jason alleges then they need to step up and work harder about removing content they do not have permission to display/distribute. Again, I realize this isn’t easy, but it is time the internet as a whole takes off some of the wild wild west and grows up. Stealing somebody’s horse back then led to a stretched neck and boot hill. Stealing somebody’s work today should not be make one sheriff of the town.

Sorry YouTube fans, time to apply pressure on them to make the site legit or go away. Before the courts do the dirty work as they’ve done with the original Napster and Kazaa. These kinds of “businesses” are houses without foundations.

• Calacanis has Dear Abby aspirations
• YouSued
• Bet against YouTube of Live video site
• Really not so Simple copyright Syndication
• Calacanis wants to siphon the most active blood from Digg and call them Netscape Navigators
• Copyright vs. copyrape: the Google Print saga