Happy birthday YouTube! The Digital Millennium Copyright Act sends its love

Video-sharing site YouTube has come a long way since co-founder Jawed Karim uploaded the site's first video exactly 10 years ago today. The unremarkable-turned-remarkable clip focuses on elephants.

"The cool thing about these guys is that they have really, really long trunks. And that's pretty much all there is to say," says Karim.

The footage lasts 19 seconds; today, "Me at the zoo" boasts a million views for every one of those seconds. In retrospect, Karim's throwaway video sparked a true watershed moment, the beginning of a technological and cultural phenomena that nobody could have envisioned. YouTube, which debuted publicly days after that first upload, has since evolved (or devolved) to host everything from cat videos to movies to music videos. DIY videos, news clips, and political statements are made by both professionals and amateurs alike—and all are available on a global scale. The site famously has more than a billion users and adds 300 hours of new video every minute.

But as important as Karim's small step was, YouTube, its competitors, and the Web as we know it likely wouldn't be here today (or would look awfully different) if it wasn't for another act—this one from Congress way back in 1998, when it passed legislation called the Digital Millennium Copyright Act (DMCA).

DMCA isn't just about cat videos

Nobody at the time the DMCA was enacted knew exactly what the Internet would become. In some sense, the law was a matter of prediction. "In Congress' mind, this is what it took to update copyright law for the new millennium," Eric Goldman, a Santa Clara University School of Law professor, told Ars.

Then-President Bill Clinton signed H.R. 2281 on October 28, 1998. In a signing statement, Clinton said the Act would balance "the interests of both copyright owners and users." The measure was an outgrowth of international copyright treaties, called the WIPO Internet Treaties, that the United States was participating in. But perhaps more importantly, the DMCA came amid intense lobbying from the entertainment industry. Given the rise of the Internet and devices allowing a la carte entertainment consumption, content creators feared their intellectual property would be undermined by emerging technology. That's why the DMCA makes it illegal, for example, to market technology enabling the unscrambling of the encryption on DVDs.

"Through enactment of the Digital Millennium Copyright Act, we have done our best to protect from digital piracy the copyright industries that comprise the leading export of the United States," Clinton said.

One critical feature of the DMCA over time has been that it protects Internet companies from copyright liability as long as they remove or "take down" infringing user-generated content at the request of a rights holder. Companies that comply are granted "safe harbor." The DMCA, in conjunction with other laws like the Communications Decency Act (CDA), freed up Internet companies from worrying about user-generated content—and thus gave birth to a wide swath of today's Internet services. In fact, it's hard to see how YouTube or the Web at large would have gotten off the ground if sites were legally responsible for all of their user-generated content.

"Without the legal protections provided by Congress, YouTube would not exist in its current form and probably would not exist at all," Goldman said. "We can trace billions of dollars in activity that can be attached to the safe harbor."

Imagine Twitter, Goldman said, if it had to screen tweets "before they go public." This alternate universe idea isn't new. However, the DMCA's success is worth pointing out on YouTube's birthday because largely we associate the DMCA with something else entirely—abuses.

"The safe harbor, even if it was full of holes, turned out to spur enormous innovation in the Internet industry," Mark Lemley, the director of the Stanford Program in Law, Science, and Technology at Stanford University, told Ars.

Anupam Chander, a law professor at the University of California, at Davis, goes one step further. When considering how vital the DMCA is and was in a paper titled "How the Law Made Silicon Valley" (PDF), Chander said Silicon Valley might have lost innovation entirely and become "the valley of death" without the DMCA.

Imagine the boardroom in a Silicon Valley venture capital firm, circa 2005. A start-up less than a year old has already attracted millions of users. Now that start-up, which is bleeding money, needs an infusion of cash to survive and scale up. The start-up lets people share text, photos, and videos, and includes the ability to readily share text, pictures, and videos posted by one’s friends. If that start-up can be accused of abetting copyright infringement on a massive scale, or must police its content like a traditional publishing house lest it face damages claims or an injunction, your hundred-million-dollar investment might simply vanish to plaintiffs’ lawyers in damages and fees. An injunction might stop the site from continuing without extensive human monitoring that could not be justified by potential revenues. Because of the insulation brought by US law reforms in the 1990s, American start-ups did not fear a mortal legal blow. The legal privileges granted to Internet enterprises in the United States helped start-ups bridge the valley of death.

YouTube was sold to Google for $1.65 billion in stock in 2006. Karim, his co-founders, and main financial backer, Sequoia Capital, reaped an enormous windfall. Karim got Google shares worth $64 million at the time, while co-founder Chad Hurley earned $470 million in shares, and co-founder Steven Chen reaped $326 million in stock.

Viacom v. Google

The very next year, the DMCA and YouTube were put to the test. This shocked no one. After all, the DMCA was a compromise between hardliners demanding copyright liability for companies hosting user-generated content and purists saying nobody should be liable.

In 2007, Viacom sued Google seeking more than $1 billion in damages. Viacom accused YouTube of copyright infringement for hosting uploaded content from Viacom shows like SpongeBob SquarePants, The Daily Show with Jon Stewart, and South Park. According to Viacom, YouTube didn't qualify for safe harbor because Google knew its newly acquired site was riddled with infringing content uploaded by users. YouTube, however, claimed that it complied with the law, removing content at the request of rights holders who sent Google DMCA takedown notices.

Many watched the case closely; it had the potential to upend the DMCA as we knew it. But in the initial ruling, US District Judge Louis L. Stanton of New York agreed with YouTube.

"To let knowledge of a generalized practice of infringement in the industry, or of a proclivity of users to post infringing materials, impose responsibility on service providers to discover which of their users’ postings infringe a copyright would contravene the structure and operation of the DMCA," Judge Stanton ruled in 2010. Stanton added that Google had no way of knowing whether an upload from a user was a "fair use," whether the uploader had licensed the content, "or even whether its copyright owner or licensee objects to its posting."

On appeal, Viacom told the 2nd US Circuit Court of Appeals that rights holders were doomed under Stanton's decision. If the DMCA as-is survived, Viacom argued, "it would radically transform the functioning of the copyright system and severely impair, if not completely destroy, the value of many copyrighted creations." (PDF)

After years of back and forth, Google and Viacom settled the case out of court last year for undisclosed terms. Money is not believed to have been given to either party, though Google said it racked up more than $100 million in legal fees.

The outcome left the DMCA unscathed and YouTube free to flourish. Along the way to that settlement, however, Google changed course on how it treated copyrighted works.

Ultimately, when you're a media giant like Google, it's always best to have content owners on your side and avoid the possibility of repeat suits or Congressional alterations to the safe harbor provisions. So the year the Viacom suit was filed, Google began testing what today is known as Content ID—an automatic system for detecting copyright infringement. The filtering system allows copyright holders to upload their content to a database which is scanned against new uploads to determine whether that content is infringing. The rights holder can have infringing videos easily removed or even place ads on them to generate income from videos that somebody else has uploaded.

DMCA takedown abuses

DMCA takedowns can be and are abused by overzealous rights holders or by people and companies seeking to stifle free speech. (On top of takedowns, the DMCA has other controversial elements, including its anti-tinkering provisions. These, for example, make it illegal to mod a gaming console to play home-brewed games.)

Since its introduction, Content ID has become a weapon for some. Rogue companies have even claimed copyright on user-generated content they didn't own in order to reap financial advertising bonanzas from YouTube.

But in response to a brazen copyright infringement claim, YouTube, and its users by extension, gained even more legal protections from the DMCA. In one particular case, Universal Music had shot itself in the foot and issued a DMCA takedown notice to get YouTube to remove a 29-second video of a toddler dancing to Prince's "Let's Go Crazy," which was barely audible in the background.

The dispute illustrated just how easy it was for rights holders to initially get content removed from YouTube, highlighting abuse of the notice-and-takedown provisions of the DMCA. However, the toddler's mother who uploaded the video challenged the notice, claiming it was a "fair use" of Prince's song. There are no bright-line rules on what amounts to a fair use; it's decided on a case-by-case basis.

The flap went to court, and Universal Music argued that it didn't even need to consider fair use when issuing a takedown notice. That proposition didn't sit well with the Electronic Frontier Foundation, which represented the mother in court.

"Universal's take down notice doesn't even pass the laugh test," EFF attorney Corynne McSherry said at the time.

Universal Music's claim didn't sit well with US District Judge Jeremy Fogel in San Jose, either. He ruled that the DMCA demands that rights holders must consider fair use of their copyright before demanding the removal of user-uploaded content.

"…in order for a copyright owner to proceed under the DMCA with ‘a good faith belief that use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law,’ the owner must evaluate whether the material makes fair use of the copyright," Fogel ruled (PDF) in 2008.

Fogel's ruling, of course, didn't halt DMCA takedown abuses. To this day, takedowns remain a gray area, and many takedowns go unchallenged. But the past decade of this law interacting with the new reality brought on by YouTube has made one thing crystal clear: the DMCA isn't perfect, and neither are its Silicon Valley offspring. But the world as we know it today couldn't exist without either.