Media conglomerate Viacom is suing Google for $1 billion dollars, arguing that YouTube’s business is built on ripping off other people’s work:

“YouTube is a significant, for-profit organization that has built a lucrative business out of exploiting the devotion of fans to others’ creative works in order to enrich itself and its corporate parent Google. Their business model, which is based on building traffic and selling advertising off of unlicensed content, is clearly illegal and is in obvious conflict with copyright laws. In fact, YouTube’s strategy has been to avoid taking proactive steps to curtail the infringement on its site, thus generating significant traffic and revenues for itself while shifting the entire burden – and high cost – of monitoring YouTube onto the victims of its infringement.”

A lot of new media pundits are weighing in on the controversy, most of them arguing that Viacom is insane or evil:

• TechCrunch & Techmeme compare Viacom to Dr. Evil
• BuzzMachine calls the suit “boneheaded“, adding “They are trying to spread stupid.”
• IP Democracy calls the suit “fluffy“.

While many bloggers are supporting Google in this spat between media conglomerates, history is likely to prove them wrong.

Viacom protecting its rights as a content creator, and in doing so, may help protect the rights of bloggers, podcasters and video podcasters around the world.

Viacom filed suit against Google because there are hundreds of thousands of examples of Viacom’s content being posted to YouTube without Viacom’s permission. This content includes content from MTV Networks, Nickelodeon, BET and other stations.

YouTube has said they would put content filtering in place to minimize the illegal use of copyrighted material, but has yet to implement a proactive solution. Instead, it’s using the promise of content filtering as a carrot to entice media companies to cut revenue-sharing deals.

Google/YouTube has given Viacom limited options:

• They can do nothing, giving YouTube control over their content and what ads are tacked onto it, getting none of the advertising revenue and hoping that they’ll get so much exposure from YouTube that it will compensate for giving up control over how and where their work gets used and reproduced;
• They can cut a deal under YouTube’s terms and conditions and share a portion ad revenue;
• They can continue to play whack-a-mole, sending hundreds of thousands of takedown notices to the site; or
• They can sue YouTube and force the company to either deal with them on Viacom’s terms, or to proactively keep Viacom content off of YouTube.

The only viable option that Google has left Viacom is to sue. While it’s hard to get excited about one multimedia conglomerate suing another multimedia conglomerate, in this case the rights that Viacom is protecting are ones that bloggers, podcasters and video podcasters and other content creators need to protect.

• If you’re a content creator, do you want anybody in the world to be able to copy your work, tack on advertising and tell you to f*** off? A lot of creative people, don’t want to have the rules dictated to them. Video blogger Ze Frank, for example, adds his own advertising and controls how his videos are shared, so that he can make money off of his work. Many podcasters and other content creators want that control, and shouldn’t have to do it at Google’s whim.
• If you’re a content producer, do you want to be forced to cut a deal with YouTube under their terms? And then be forced to deal with every other video site that pops up under their terms?
• If you create a podcast or video podcast, do you want to have to play whack a mole, searching the millions of videos uploaded at dozens of video sites to find out if somebody’s ripping off your content and tacking ads on it?

$1 billion is a lot of money, but it’s unlikely that a court will have to decide if the amount is warranted.

Google will probably have to cut a deal with Viacom – a deal that will help shape the rights of content creators and the future of Internet television.

Update: HDTV pioneer Mark Cuban thinks the answer is for Viacom to spam YouTube with hundreds of thousands of promotional videos. It’s an idea, but it’s an idea that reflects a lack of understanding of how YouTube and ohter social networking sites work.