Fans immediately began putting copies of the video online. On one free video-sharing site, YouTube (www.youtube.com), it was watched a total of five million times . NBC soon made the video available as a free download from the Apple iTunes Music Store.
Julie Supan, senior director of marketing for YouTube, said she contacted NBC Universal about working out a deal to feature NBC clips, including "Lazy Sunday," on the site. NBC Universal responded early this month with a notice asking YouTube to remove about 500 clips of NBC material from its site or face legal action under the Digital Millennium Copyright Act. YouTube complied last week. "Lazy Sunday" is still available for free viewing on NBC's Web site, and costs $1.99 on iTunes.
Julie Summersgill, a spokeswoman for NBC Universal, said the company meant no ill will toward fan sites but wanted to protect its copyrights. "We're taking a long and careful look at how to protect our content," she said.
YouTube and others in the new wave of video-sharing sites have so far managed to avoid major legal problems even though they often carry copyrighted material without permission.
NBC's almost certainly right on their rights under copyright law as I understand it and purely from that perspective what they're doing makes sense. But it reminds me of back in the good old days of the internet when entertainment companies thought they could make money by offering exclusive content deals to the dinosaur "walled gardens" like AOL and MSN and then started going after amateur fan sites for putting up a .jpg of Jean-Luc Picard. Again, within their rights, but going after your fans never seems like an especially good idea especially when they're essentially offering free marketing for your product, the kind of "free marketing" these companies spend lots of money getting advertising consultants to tell them how to get.
Obviously this is a somewhat different situation. Sites like youtube try to get money from advertising revenue and as such are, technically, earning revenue from NBC's product. Still it's hard to see how this is a sensible business decision. Unlike trademark, copyright doesn't have to be aggressively defended in order to maintain it. A company can approach these things on a case by case basis and it's pretty hard to see how imagined lost revenue for NBC isn't outweighed by the marketing benefit for SNL.
As with file sharing the right business question isn't "is someone getting music for free" the right business question is "does this really cause us to, in the net, lose revenue if we adapt our business model to the new reality." Free songs, free videos, they're all marketing techniques. Of course, giving out free songs and videos isn't exactly a new idea, it's what radio and MTV (when it still played videos) have been doing for quite some time...