Viacom sues Google for $1 billion

March 13, 2007
by Latitude

As you may have heard, there are a lot of zeroes on the amount that Viacom thinks Google owes them. But do the powers that be at Viacom really think Google has bilked them out of a billion?

The suit illustrates Viacom’s misunderstanding of the web and YouTube: its claim for $1 billion essentially says that’s the amount of money it thinks it’s missed out on because of YouTube (just to put it in perspective, Viacom’s 2006 revenues were $11.5 billion). That’s pretty ridiculous, and should Viacom’s own video site ever become popular enough to deliver similar viewer stats, the revenues it generates will underline that. What’s more likely to damage Viacom’s business is removing the clips from YouTube, since it offers a free promotional outlet—something other broadcasters have noticed—that may not directly generate revenue for the company, but indirectly drives viewers to its revenue-generating products.

Liz Gannes has crunched the numbers, and they still don’t make much sense.

According to U.S. copyright law, when a copyright owner’s claim of willful infringement is upheld, the court can award damages of up to $150,000. That would be for every instance of infringement, which could possibly mean every clip. Take a trip to the calculators, noting that Viacom today pegged the number of infringing clips at 160,000. At up to $150,000 a pop, that’s potential total damages of $24 billion. Seriously. $24 billion.

So Viacom’s actually being charitable in only asking for $1 billion? It’s more likely that they knew $24 billion would sound a lot more outrageous than $1 billion, which is – let’s face it – still pretty incredible.

Blog, RSS, and podcasting pioneer Dave Winer says: