If you can’t beat ‘em, join ‘em!

Last month, blogger Ben posted this piece highlighting the Recording Industry Association of America’s complaint that U.S. copyright law isn’t working in protecting their copyrighted content from appearing illegally on the Internet. Perhaps, the RIAA should take a cue from the numerous copyright owners who are now working in cooperation with YouTube to monetize infringements.

According to a September 2 article about new YouTube revenue streams, available here, if a user uploads a video that incorporates copyrighted material owned by another person or entity, the copyright owner could choose an alternative to having the video removed through the Digital Millennium Copyright Act take-down process. Instead, the copyright owner could allow the video to remain posted and allow YouTube (a subsidiary of Google) to run Google ads at the bottom of the video. In return, the copyright owner receives half of the ad revenue generated by the Google ads, with the other half of the revenue being kept by YouTube.

Given the difficulty of preventing unauthorized uses of copyrighted material on the Internet, copyright owners may benefit more by leveraging the apparent popularity of their material in return for unanticipated cash payments. Of course, the copyright owners would retain the option to determine whether the most appropriate course of action is to have the video taken down or to allow it to remain viewable with embedded ad content.

An initially-unauthorized video from the TV show Mad Men generates revenue through Google ads, right.

As Google has perfected the art of “targeted advertising,” the ads visible on such videos could be targeted for the likely viewer. Dave Marsey, senior vice president of media at Digitas, explained to the New York Times, “Google smartly realized that consumers consume different types of media throughout the day. Search is a huge component of that, but there are times when you want some entertainment or you want to solve a problem and going to YouTube makes sense.” In fact, YouTube reports that hundreds of content partners with which it shares ad revenue receive more than $100,000 a year. One clever example described in the article could become a new source of income for the RIAA: an unauthorized upload of Eminem’s “Not Afraid” was permitted by the copyright owner to remain viewable with ads linking to authorized sites through which viewers could purchase the song or ring tone. The revenue generated was split between the copyright owner and YouTube.

This “if you can’t beat ‘em, join ‘em” strategy seems like a win for all involved: the video poster avoids having his video removed, interested viewers of the video maintain access, YouTube generates revenue that will help it reach profitability, and the copyright owners enjoy increased brand impressions with each view, as well as (and possibly more importantly in a down economy) an increase in their revenues. Content owners should thus consider whether this strategy may work well for them, especially if they frequently expend time and resources issuing DMCA take-down notices.