Eric Schmidt interview by Ken Auletta of The New Yorker

June 14, 2008

News: Eric Schmidt again admits that Google hasn’t figured out a way to monetize YouTube. The video of the interview by Ken Auletta is located here.  Click here for a news summary.

Analysis:  CNET’s Don Reisinger has a pretty scathing review:

“Let’s face it — the YouTube acquisition was a major blunder and regardless of how successful the company is in other areas, there’s no reason to suggest advertisers are willing and ready to place ads on videos of 18-year olds shooting milk out their nose or 80-year old men mooning a parade.

“As far as I can tell, much of the online advertising money is going to sites like Hulu where the content is controlled, the shows are regulated, and the demographics of the audience are easily obtained.

“How does YouTube and its content compare? The audience is huge, but it’s filled with a diverse set of people who generally view a select few of the more popular videos; the videos are barely regulated; and the content isn’t controlled in the least. Why should any advertiser want to send cash to a service like that? * * *

“Will YouTube become the dump of advertising where strip clubs and brothels will advertise on sexually-oriented videos and unknown politicians will sell themselves on left- or right-leaning clips? I certainly don’t see Johnson and Johnson sending ad dollars to YouTube anytime soon.”

Eric Schmidt speaks about cloud computing, innovation, + future of Internet at Ecnomic Club of Washington

June 10, 2008

News:  Google CEO Eric Schmidt spoke about the Future of the Internet before the Economic Club of Washington.  For a press account, click here.  I will link to the video once it’s up.

What is Web 3.0? Eric Schmidt’s view

January 26, 2008

I’ve been meaning to blog about this video clip of Google CEO Eric Schmidt’s take on Web 3.0.  It’s a fascinating explanation and prediction of the next phase of the Internet.  His explanation is so good, I’d rather let you just listen to the explanation rather than attempt to paraphrase it.  You can tell this guy has a Ph.D.

We’re probably not yet there at Web 3.0, but the possibilities seem fast approaching.  We’ve barely had time to digest Web 2.0, but here’s a video with a good explanation of the history behind the term Web 2.0.

In my legal scholarship, I try to analyze complications created by new technologies for existing paradigms of law, usually in the area of intellectual property.  Right now, I’m continuing my exploration of how Web 2.0 affects our copyright laws.  Hopefully, I’ll have a draft soon to share online.

Mossberg interviews Google CEO and Viacom CEO

June 1, 2007

News: WSJ writer Walter Mossberg also interviewed Google CEO Eric Schmidt and Viacom CEO Phillipe Dauman, separately, asking many questions about copyright law. Obviously, the two CEOs disagree.

Analysis: Because the DMCA safe harbor provision is not crystal clear, the uncertainty allows YouTube/Google and Viacom to have different takes on what it means.  Much of it revolves around how much burden to police YouTube for infringement should be left to individual copyright holders versus YouTube itself.

Google CEO announces new filtering system for YouTube

April 17, 2007

News:  At the National Association of Broadcasters, Google CEO Eric Schmidt said that YouTube will soon launch a filtering system called “Claim Your Content,” which reportedly “will automatically identify copyright material so that it can be removed.”  (More here)

Analysis:   Not yet clear whether this is the Audible Magic filtering technology for audio that had been announced back in February, or something more.

Wired interview w/ Google CEO Eric Schmidt

April 10, 2007

News: Wired has an interview with Google CEO Eric Schmidt in which he discusses YouTube and the Viacom copyright lawsuit.  Here’s the relevant part:

Wired: In March, media giant Viacom sued Google, claiming that YouTube is stealing its video content. What made Viacom decide to go to court?

Schmidt: It’s a business negotiation. We’ve been negotiating with them, and I’m sure at some point we’ll negotiate with them some more.

Wired: Viacom’s argument is that you’re not working hard enough to keep infringing clips off of YouTube.

Schmidt: Well, if they would look at the law, they’d understand that under the Digital Millennium Copyright Act, there’s a shared responsibility. The law says that the copyright owner monitors — and then we expeditiously remove — offending clips. We’ve done that. In fact, YouTube’s traffic has grown since we did. So Viacom’s argument that YouTube is somehow built on stolen content is clearly false.

Wired: How could copyright law in the digital age be clearer?

Schmidt: The balance that was struck in the DMCA has worked pretty well, and I think it may be better for all of us to work within that framework for a while as we develop these new businesses. It’s the unintended consequences of new laws that always get you.

Analysis:  Eric Schmidt’s comments are well taken.  First, he’s exactly right about the DMCA safe harbor provision — service providers like YouTube do not have to affirmatively patrol their site for copyright infringement.  The legislative history and case law on the DMCA are pretty clear about that.  In a networked environment, it would be virtually impossible for Internet service providers to have to patrol their sites for copyright infringement.  Viacom doesn’t like patrolling YouTube for copyright infringement but that burden is relatively small when compared to the burden YouTube would face in having to patrol its site for all copyright infringement.  Viacom is only one copyright holder and only has to look for its own shows on YouTube.  But the reverse rule sought by Viacom would mean that YouTube would have to look for copyrighted works of not just Viacom, but hundreds, if not thousands, of copyright holders.  Schmidt’s right that, under the DMCA, there is a “shared responsibility” among Internet service providers and copyright holders.

Second, Schmidt refutes Viacom’s assertion in its complaint that YouTube’s business model is built on “stolen content.”  Referring to a recent study that indicated YouTube’s traffic increased after Viacom’s shows were removed from YouTube, Schmidt says that Viacom’s assertion is  “cleary false.”  I’ve already blogged about this aspect of Viacom’s complaint before — it seems overblown to me and vulnerable to summary judgment. 

Third, the most revealing aspect of Schmidt’s comments, though, are not legal.  Schmidt says that the lawsuit is a part of the “business negotiations” with Viacom.  You don’t even have to read in between the lines to conclude that a settlement of the case is very likely.   One of the things that I’ve learned since I started following YouTube is the important role business and consumer dealings play in or in addition to copyright law.  It would be a mistake to think of the dispute between YouTube and Viacom only in terms of copyright law.  Even the DMCA safe harbor provision is premised on a certain practical arrangement that accepts the existence of some “network” type infringement on the Internet.

That said, Viacom could always elect to forego settling the case and pursue it the very end.  But could Viacom afford the risk of losing the case and giving Google even more bargaining power?

Google CEO Schmidt talks shop on YouTube

March 7, 2007

News:  Google CEO Eric Schmidt gave a revealing interview/talk yesterday to industry and financial folks.  Schmidt tried to manage expectations on YouTube’s ability to earn money, saying:  “Looking at the traffic, user-generated video has tremendous interest. There is a large advertising opportunity to be built on that traffic. But an old joke in the Internet is that URL stands for Ubiquity first, Revenue Later.”

Schmidt also joked about some of the perceptions that Google is arrogant and plays hardball in negotiations:  “I’m sure we’re arrogant.  But I have learned that as part of being a player in the media industry, part of negotiations is that everything is leaked and you are sued to death.”

Meanwhile, Viacom CEO Philippe Dauman defended his company’s decision to break off negotiations with YouTube, but left open the possibility of securing a deal:  “We may do a deal with them someday on terms that meet our criteria or we may not.”  Dauman couldn’t resist taking a potshot at YouTube’s user-created content:  “People aren’t going to spend money for user-generated content like a cat going to the bathroom.” More here and here.

Analysis:  There’s a lot of posturing here by two heavyweights.  Dauman’s quote about the cat videos is funny, but you shouldn’t underestimate the appeal of user-created content.  In fact, the majority of YouTube’s most watched videos are from ordinary users creating their own videos.  I think a lot of the appeal about YouTube is that it doesn’t provide all the same stuff on TV.

Is Google CEO Eric Schmidt the key to YouTube’s success?

November 5, 2006

News:  Now that the FTC approved Google’s acquisition of YouTube, it will be interesting to see how much power Google CEO Eric Schmidt wields on behalf of YouTube, behind the scenes.  In a quote by the Wall Street Journal this week, the 29-year-old CEO and co-founder of YouTube Chad Hurley seemed perplexed by the negotiations with the movie and music industries:  “It’s such a mess because the [entertainment companies] have all of these valuable assets that are just locked up with so many people who need to sign off on them. I don’t know what it requires, if the government needs to be involved,” Mr. Hurley laughs. “I don’t know.”

Friday, however, Google issued the following statement:  “The Internet offers real opportunities for media companies to reach a wider, global audience and to interact more directly with users.  Google is always talking to potential partners about how to make the most of the opportunities provided by the net.”

Analysis:  Although YouTube will retain its corporate identity and co-founder Chad Hurley will retain his position as YouTube’s CEO, the statement by Google strongly suggests that Eric Schmidt is wielding his influence in negotiations with the movie and music industries.  This is no knock on Mr. Hurley, who appears to have done a very respectable job so far, especially in securing the Google deal.  But Eric Schmidt is a Silicon valley veteran, with “street cred” that is beyond doubt: an engineering PhD, a founder of Sun Microsystems, and former CEO of Novell.  Schmidt was brought into Google when the venture capitalists who had invested in Google were clamoring for a more experienced businessman to help co-founder twenty-somethings Sergei Brin and Larry Page run Google.  In other words, the 51-year-old Schmidt helps to provide the “adult supervision” thought by investors to be necessary for a young, fast growing company.  And so far he has. 

Eric Schmidt, CEO of Google, on the YouTube acquisition