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YouTube software threat to Google plans

By Richard Waters in San Francisco
Updated: 4:40 a.m. ET Dec. 30, 2006

YouTube's failure to complete a key piece of anti-piracy software as promised could represent a serious obstacle to efforts by Google, its new owner, to forge closer relations with the media and entertainment industry.

The video website, the internet sensation of 2006, promised in September the software would be ready by the end of this year. Known as a "content identification system", the technology is meant to make it possible to track down copyrighted music or video on YouTube, making it the first line of defence against piracy on the wildly popular website.

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YouTube said on Friday the technology would not be formally launched this year and YouTube's offices were closed until the new year. While providing no further details about when the system would be made formally available, it said tests of the system had been under way with some media companies since October and the system remained "on track".

Mike McGuire, a digital media analyst at Gartner, said the important part systems such as this played in building better relations between internet companies such as YouTube and the traditional media industry meant there was likely to be little patience for missed deadlines. "The technology industry really has to start living up to the media industry's expectations," he said.

If the delay lasts for more than a week or two into the new year, suggesting more than just a slight technical hitch, "this is certainly going to be a serious issue", Mr McGuire added.

Leading music companies have already made clear they see completion of YouTube's anti-piracy technology as an important step in any closer co-operation. Failure to build adequate systems to protect copyright owners could also add to the risk of legal action against the site.

Doug Morris, chief executive of Universal Music Group, hinted at legal action against YouTube late last summer, accusing both it and MySpace of being "content infringers [that] owe us tens of millions of dollars". Universal went on to sue MySpace but was one of the companies to reach a partnership with YouTube, partly based on the ability of its promised content identification system to track down copyrighted music.

The delay to the software could also spell wider problems for Google, which has been trying to negotiate partnerships that will give it access to content from a number of big media and entertainment companies. The company could not immediately be reached for comment.

On Friday night, a YouTube spokeswoman said the company had never promised general availability by the end of the year.

Copyright The Financial Times Ltd. All rights reserved.
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