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LOS ANGELES - What does Sumner Redstone have in common with Steve Hirsch, founder and president of the world's largest producer of hard-core sex videos? More than the Viacom honcho might think.
Hirsch's Vivid Entertainment, the biggest name in the US$12 billion-a-year adult video industry, filed a lawsuit last month against PornoTube, one of a handful of popular video-sharing sites styled as the dirtier cousins of YouTube, Redstone's legal nemesis. Similar to the Google-owned video juggernaut, PornoTube has become a destination for free porn by letting anyone post sex videos without filtering out clips that might be copyrighted.
"In other words," the lawsuit reads, PornoTube "deliberately and knowingly built a library of infringing works ... enabling them to gain an enormous share of the internet traffic, increase its businesses and earn vast amounts of revenues in the process."
Redstone's words, almost exactly. Vivid's argument mirror's Viacom's $1 billion claim against YouTube, filed last March and just entering the discovery phase in New York. At issue in both cases is whether video-sharing sites are shielded from liability by the Digital Millennium Copyright Act if they take down videos once asked and don't profit "directly" from the infringements. (Vivid also claims PornoTube violates a strict child-pornography law by not verifying the ages of the participants in videos posted on its site, though recently an appeals court ruled against that law on free speech grounds.)
The copyright infringement issue is unsettled, but the cases are piling up. Vivid joins Titan Media, a gay erotica publisher that sued the Michael Eisner-backed Veoh, as well as Viacom's case and the plaintiffs in a class action also pending against YouTube in New York.
Hirsch believes PornoTube doesn't do enough to keep his content off its site, and, like YouTube, it has leveraged the traffic it now delivers into marketing deals with other sex video producers. It has left Hirsch, a leader in an industry that has welcomed new technologies like the VCR and VOD much more than its Hollywood equivalents, with little choice but to sue the pants off the free sites.
"How do we survive?" Hirsch asks. "We don't produce videos just because it's fun. As DVD sales decrease, we need to look to other revenue streams."
Domestic DVD spending for mainstream fare was off 3.6 per cent in 2007, but Hirsch told Portfolio magazine recently that Vivid's DVD sales are down 50 per cent since 2004. VOD is the future, he says, but he can't compete with free. PornoTube and its brethren YouPorn and XTube continue to draw mass amounts of traffic, and they don't seem to care about monetizing the eyeballs.
North Carolina-based PornoTube didn't respond to a request for comment. But Vivid's critics, much like those criticising Viacom in the YouTube case, argue that most of the porn on the sharing sites is created and distributed by amateurs. And what copyrighted stuff there is probably serves as valuable promotion for Vivid. Hirsch disputes both those arguments.
"Two or three minutes - that's all you need," Hirsch says. "After watching two or three minutes of hard-core sex, you're not going to go and buy the full movie. And if you look on these sites, an overwhelming amount of content is copyrighted."
Hirsch likens the porn industry's perilous situation to the music business' similar reliance on consumers paying for collections of product (albums) that can be enjoyed in bits and pieces - and often for free on the internet. Total album sales slid 15 per cent in 2007, the third consecutive year of decline.
Hirsch says he and his legal team are gearing up for a long fight. They could probably call Viacom's lawyers for some tips.
- REUTERS
