Media Wonk

Is YouTube the next iTunes (but not in a good way)? - June 12, 2007

Here’s a question: If the homegrown video fingerprinting technology YouTube reportedly will soon begin testing with Time Warner and Disney actually works, and leads to deals with other major content owners, would Google/YouTube ever license the technology to other platform providers?

I’d say, probably not. It’s proprietary technology that could become instrumental to YouTube’s business model. Why share (if you’ll pardon the pun)?

But couldn’t that put YouTube in the same (or similar) position as Apple has enjoyed in the online music business, with the market-dominant platform, based on a proprietary form of rights management that effectively locks out competitors?

Hmm.

When YouTube first started looking seriously at using filtering technology to keep unauthorized copyrighted content off its network, it focused on AudibleMagic’s system for identifying the audio tracks of video clips. Fingerprinting audio is easier than fingerprinting video and the studios are already familiar with inserting identifiers into the soundtracks of theatrical prints for forensic purposes.

From the content owners’ point of view, an off-the-shelf solution has some advantages. Once they’re comfortable with the technology, they can insist on its use by platform providers without becoming beholden to the content protection system used by any one platform.

But somewhere along the way, YouTube apparently switched gears, and began working with engineers at parent company Google to build a video fingerprinting system from the ground up.

It’s possible YouTube had no other reasonable choice. If there was not an off-the-shelf solution that met the studios’ requirements, YouTube would either have to forget about filtering and face a raft of lawsuits, or come up with a workable system itself.

Whether the studios themselves had a direct hand in the engineering is not known at this point. YouTube officials told Reuters that they developed their fingerprinting technology “was built with the Disney’s and Time Warner’s in mind.”

But it could end up being a shrewd move by YouTube.

Chances are, YouTube’s fingerprinting system won’t ultimately be used only to keep content off the site. Rather, it’s likely to be the basis for a revenue-sharing business model with content owners.

If other video-sharing sites don’t have a filtering system to offer content owners that at least matches what YouTube offers, YouTube could end up with most of the licensed content while the others fend off lawsuits.

Handing YouTube that much leverage probably isn’t in the content companies’ business plan for online video distribution, but it wouldn’t be the first time they let their fixation with copyright infringement lead them into a trap.

Apple made the record companies pay for their blindness. The studios have not excuse not to have their eyes wide open.

Did I mention that Apple and YouTube are now working together?

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