Suing YouTube won't be the salvation of Hollywood

Mark Cuban and Forrester have both argued that YouTube will get sued, and lose, and have to take down all the copyrighted material on the site. Mark Cuban went so far as to say that, therefore, "only a moron" would buy YouTube, on grounds that only once it's owned by anyone with real money will it be worth suing. LostRemote counters that YouTube will take down the copyrighted material and it won't matter so much - that it's the long tail of user-generated video that brings users to the site, and that'll be fine.

LostRemote is right, of course - Cuban and Forrester are thinking about video content distribution in terms of the Hollywood blockbusters that dominated the pre-digital media landscape. (Still dominate the media landscape, you say? Yes, but only insofar as - to borrow a phrase from Innosight via Simon Waldman - the new game has begun before the old game has ended.) YouTube isn't even a very efficient way for audiences to pirate copyrighted video content compared to say BitTorrent, and this certainly isn't where the value of YouTube is vested.

The (largely untapped) value of YouTube is in the marketplace it engenders between content creation and content consumption (Umair), the fact that - like eBay did for the junk that was cluttering up everyone's garage - it creates a market that didn't previously exist and puts the creator of niche content efficiently in touch with the right audience for that content. It's a post-blockbuster digital content marketplace...and the studios suing the owners to take the blockbusters off will be an ultimately futile response to the collapse of their own position in the value chain.