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Why Copyright Will Be The Biggest Issue For Youtube In 2019 (Updated)

This article is more than 5 years old.

© 2018 Bloomberg Finance LP

This post has been updated: This post originally included the inaccurate statement that Fair Use in the U.S. is codified in the FAIR USE Act. While the act was a proposed amendment to U.S. copyright, it never was codified as law. Fair Use in the U.S. is instead decided by Section 107 of the Copyright Act, which still protects material as fair use if its purpose and character of use are sufficiently transformative.

2018 was a difficult year for YouTube internally with misbehavior by its creators, concerns about demonitization, and struggles to balance the YouTube business and YouTube community. However, throughout the latter half of the year, YouTube has been also engaged in a quiet war with the European Union over the Copyright Directive, and this directive will have important consequences for YouTube users in the EU and abroad in the coming year. The platform’s most popular content, memes, film reviews, and video game playthroughs, are jeopardized by new legislation that YouTube has suggested will force the site to create an “upload filter” that will block content with potential copyright violations.

The Copyright Directive is the EU’s effort to modernize copyright laws, prevent piracy, and ensure that original creators are paid for what they produce. This has been a particular problem in the music industry. As musician Paul McCartney mentions in a letter of support for the Copyright Directive there is a “value gap,” in which media platform companies are able to profit from copyrighted material without adequately compensating the artist. Concerns about fair pay in the internet age is not new for music artists and were behind Taylor Swift’s hesitation with Spotify and Beyonce and Jay-Z’s development of Tidal. Many European networks, studios, and publishers have supported the Copyright Directive in order to fix this value gap.

The European Union’s solution, approved by the Parliament in September and to be put to a final vote in the spring of 2019, assuages the concerns of original content creators by holding media platform companies, like YouTube, liable for copyrighted content, codified in Article 13. It is this provision that has encouraged a rare alliance between the YouTube corporation and its creative community. YouTube has argued that it already has the means of detecting and compensating original creators for their work, Content ID and Copyrights Match Tool. These tools help original creators detect copyrighted content and then report violations to YouTube, which will then remove the offending video. However, in 90% of cases of copyright use on the platform, CBO Robert Kyncl states that the original content producers opt against removing the video and instead request that video ad revenue is shared with them. Content ID has distributed over €2.5 billion to copyright holders. This ex post facto copyright review of YouTube videos is what Article 13 will change.

With Article 13, YouTube will have to deploy ex-ante measures to avoid liability, which will mean the introduction of algorithmic filtering. YouTube material that might use other copyrighted material will simply be denied from being uploaded to the site. The idea of an “upload filter” has incensed the YouTube community, rightly concerned with the over-broad results of these algorithms. This is not helped by the fact that, while establishing company liability for copyrighted material, the directive makes no move to streamline copyright laws between EU member states and the U.S where YouTube is based.

Section 107 of the U.S. Copyright Act protects work that uses copyrighted material for transformative purposes, notably parody and criticism, as Fair Use and has served as a basis for a lot of the content that has made YouTube famous such as video game playthroughs, video essays and film reviews, reaction videos, and memes. Although EU legislators have argued Article 13 will continue to make exceptions for fair use, YouTube has argued that their algorithms lack the nuance to discriminate between fair use copyright and copyright infringement.

YouTube’s argument is well-evidenced. The platform has historically struggled to develop a precise copyright detector, and fraudulent or weaponized copystriking, fraudulent or excessive copyright claims, has been an issue for the platform’s creators as well. In 2013, companies like Indmusic and Tunecore were criticized for their ultra-sensitive copystriking of video game playthroughs by creators who unknowingly included a copyrighted song from the game’s soundtrack, and video game companies and film studios have used copyright violations to censor unfavorable reviews. Copyright striking is a serious issue for YouTube creators and can rob them of revenue and content or even result in their deletion. With the expansion of ex-ante copyright algorithms because of Article 13, while nominally protected, many of the videos that make YouTube popular, from memes to film reviews, will be jeopardized. There will no longer be an option for the original content creators to profit from their copyrighted work as these videos will not be allowed to be uploaded. CEO Susan Wojcicki stated that Article 13 would lead to millions of EU residents not having access to videos that they viewed over 90 billion times last month.

Concerns over Article 13 have resulted in increased corporate and community activism to get the language changed. Many YouTube news channels have made videos explaining the issues, the largest one being Philip DeFranco. This increased activism has done little to change lawmaker opinions. After its approval by the European Parliament in September, the Copyright Directive is now being negotiated between the Parliament, the Commission, and EU member states with a final vote to come before the Parliament between January and March. Although Article 13 might be watered down or removed within these negotiations, it is highly likely that the Copyright Directive will pass with or without it, having been developed since 2016 and a needed update to the most recent 2001 copyright laws.

When the Copyright Directive does pass it is assured to have global effects as media platform users see their favourite European creators facing greater scrutiny or, if they are EU residents, their favourite videos being unavailable due to copyright concerns. However, 2019 might not be as bleak as the YouTube corporation would make it seem. It has been accused of using fear-mongering tactics to derail the EU’s attempts to guarantee fair compensation for musical artists. Despite its claims of distributing over €2.5 billion to copyright holders, the company pays artists €1 for every €10 that Spotify pays when copyrighted material is used, and the Copyright Directive can take steps in remedying this imbalance. Additionally, Youtube’s threat to remove all material that potentially contains copyright violations in the European Union seems like a way to scapegoat the directive for a problem that the platform has had for a while and needs to correct— imprecise algorithms and lack of resources and processes to fight improper or fraudulent copyright claims. In the fight over copyright modernization, there is room for both the EU and YouTube to make concessions for the sake of the creators they claim to protect. Without concessions, it is the users who have the most to lose.