Google, YouTube Aim to Settle With Big Media

Dec 1, 2006  •  Post A Comment

Google and YouTube are offering settlement figures upwards of nine figures to big media companies in exchange for removing the specter of lawsuits, BusinessWeek reported today.

The story said that Google refers to the money offering as “licensing fees,” but the dollars are actually intended as payments in exchange for giving Google the time and space to work out the copyright issues and partnership challenges it faces with YouTube.

In a statement, Google said, “While we can’t comment on specific discussions with specific partners, in general we are focusing our discussions with media companies on developing the Internet as a new channel to distribute and promote their work.”

With 30 million unique users in October, big media companies and TV networks are attracted to YouTube’s reach. But they have also been wary about the sheer volume of unauthorized material the site traffics in.

Google built a $200 million financial buffer into its acquisition of YouTube that will likely go towards any potential copyright issues and lawsuits. Google is likely to spend several months settling old and new scores and is likely to pay out even more than it’s put aside, said Damian Riordan, director of media and entertainment with HT Capital Advisors. “When Google puts $200 million in, that tells me it will be at least twice that,” he said.