Google To Hold $200 Million In YouTube Deal
The rumor that Google was setting aside $500 million for their deal with YouTube is false. Its only $200 million. CEO Eric Schmidt previously denied the rumor that Google would use the money to fend off any lawsuits regarding copyright infringement.
In a statement Google said they would be withholding 12.5% of the stock that they owe YouTube for one year ""to secure certain indemnification obligations." While it is not an unusual practice why would Google deny this in the first place? It is not a secret that there has been controversy about copyright infringement surrounding YouTube.
They have been quick to pull any footage when they received complaints about copyright infringement from major media. Google has been working with media companies to try and form agreements. Schmidt said last week "We have visited as many media companies as we can"
YouTube could still be in danger of lawsuits over copyright infringement now that Google officially owns them. YouTube features both original content videos and pirated videos. The money is there and so are the lawyers.
If YouTube continues to comply with requests to take down copy written footage than they will probably be okay. If not I guess that's where Google's $200 million will come into play.
Before the finalizing of the deal YouTube received $15 million from Google to help cover their expenses. YouTube, though popular had not turned a profit in its young 18-month life.
Just what is next for YouTube and Google is the bigger question. Will the litigation over copyright issue's start to entangle the 2 companies or will they be able to successfully negotiate any legal difficulties they may face?
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