Decoder with Nilay Patel
00:46:27 · Mitch Glazier
[00:46:27] S4: What's so fascinating to me about YouTube is that it is the first real lesson in the arc of sort of the DMCA where we real... Where where I think a technology based company realized that even if you win the fight on intellectual property rights, if you don't have partnership through a license in the actual market where fans are, you're not going to have the service that fans really want. And so it was the first time that you know we we took everybody realized that, you know, you can win the case but lose the business. Mhmm. And music is such a driver of YouTube, and I think this applies to sort of AI too, that having a pristine... Having pristine copies, right, that fans really want, and then having marketing partnerships and partnerships with people who invest with and partner with creators who have a better sense of how to create the bond between that particular artist that they've been living with and sort of building a brand around and understand versus, like, sitting in a cubicle in a tech company and, like, trying to decide how to connect the fan with the artist in the best way. Like that former piece is irreplaceable. And I think YouTube realized that and developed Content ID even though they technically won in court. Right? And didn't have to so to speak. And now it's so ingrained, the partnership is so ingrained that there's a there's a dependency or a codependency and and that's how it's supposed to work. It also works because of this concept in copyright law called substitution. Right? Like if what you're creating substitutes for something else, it's probably not fair use. That's what we're arguing in our case against Suno. You're basically creating music that is competing on the same platform right next to human made music and you can click on either one and you're paying the same subscription fee and so you're affecting the economic pool and you're effectively substituting in the marketplace.
00:48:39 · Nilay Patel, Mitch Glazier
[00:48:39] S3: This is the fourth factor of the fair use. [00:48:41] S4: This is [00:48:41] S3: the fourth factor of [00:48:42] S4: fair use which, yeah, which court say is the most important which is are you affecting the potential market for the underlying work. And you know, if you are that sort of problem number one. Google in their case, unlike the YouTube case under the DMCA, Google in their case that they won in the Supreme Court was about creating an index and the idea is if you click on it, it could lead you to the work that you might then buy. So instead of substituting for the work, the search result doesn't substitute for the work, but it could lead you to the work, which at the end of the day may not have the same economic consequence. It could even have a positive economic consequence. At least they would argue that. So there's this weird thing like Google won its case and YouTube won its case, but YouTube formed a partnership despite it because it needed to do so because that's the best fan experience. And Google didn't because it wasn't as related to the fan experience. Fan experience was potentially pointed to by their activity. So that's my weird, like, [00:49:46] S3: lost world take on the two running Google, if you're if you're in charge of Google Gemini, you need all of the data in the world. [00:49:55] S4: Yes.
00:49:55 · Mitch Glazier, Nilay Patel
[00:49:55] S4: Yes. [00:49:55] S3: Right, like that is the that is just how it works. To make the models better and to win against OpenAI you need more data and all of those companies just took it. I do not think Google came to you and said can we license all the music in your database Even though we already have a license on YouTube. In fact, they just scraped YouTube, right? I don't think creators have like woken up to the fact that they've given a lot of economic value to Google and its models. The other AI companies also scraped YouTube and Google can't yell at them because then they will have to reveal that they scraped YouTube and this is about as tense a fight in AI industry as there is. [00:50:30] S4: Yes. [00:50:31] S3: You're gonna come to Google at some point and you're gonna say no you got to pay us for that training. Right? I know you're suing Suno but that feels like a little test balloon for the people with the real money. At some point they're gonna say, no, this training was fair use, right? We're watching this dynamic play out in dozens of these cases across the industry. How do you make sense of that? Where you're gonna say, you're gonna kill us. If the AI models flood YouTube with fake music, you're actually gonna kill the supply of the data that you need.
00:50:31 · Nilay Patel, Mitch Glazier, Nilay Patel
[00:50:31] S3: You're gonna come to Google at some point and you're gonna say no you got to pay us for that training. Right? I know you're suing Suno but that feels like a little test balloon for the people with the real money. At some point they're gonna say, no, this training was fair use, right? We're watching this dynamic play out in dozens of these cases across the industry. How do you make sense of that? Where you're gonna say, you're gonna kill us. If the AI models flood YouTube with fake music, you're actually gonna kill the supply of the data that you need. [00:51:03] S4: So there's the there's the legal side and the business side. On the on the legal side, obviously, we're bringing this case as a precedent setting case to show that it is not fair use to train on music. Whatever exemption you wanna think of, it's hard for us to imagine how it applies. Right? I I don't I don't think national security is at risk because you have to copy Drake. I I just I just don't I don't think [00:51:26] S5: that there's [00:51:27] S3: What do we play in, like, the war in Panama? We, like, played Metallica at them at full volume. [00:51:31] S4: Right. Right. Now... Right. Maybe maybe it's... Right. Maybe it'll be used for, like, you know, for soft power or, you know, propaganda blasting on the screen. [00:51:39] S3: The Clash was very upset when Rock the Casbah was the soundtrack. I'm I'm just letting you know.
00:51:39 · Nilay Patel, Mitch Glazier
[00:51:39] S3: The Clash was very upset when Rock the Casbah was the soundtrack. I'm I'm just letting you know. [00:51:44] S4: I bet. Going back to securing the rights. We're bringing this case to make sure that the rights are secured. So then every company knows that you are not allowed to make reproductions of other people's music without consent or compensation. That's basically what we're trying to establish. And then once you secure the right, you let the marketplace develop from there. And I'm sure that the that the good people at Google and at other companies understand the risks. It's it's fascinating, Nilay. I don't know if you've read the SEC document that Anthropic just had to file Yeah. In order to have their IPO. But in the risk section, it's basically like, well, it could be that all this scraping that we've been doing actually violated all these laws. And that could, you know, if it's willful, put us in in a liability, you know, deficit of of x and share... People who are investing as new shareholders should sort of know that information. So they kind of acknowledge upfront like this could be a big cost of doing business going forward. And yet they're gonna have a spectacular IPO. Yeah. Right? Despite those risks. Which means that they're willing to bear them and they're also willing to accept the cost if and when that comes and it is secured.
00:53:07 · Nilay Patel
[00:53:07] S3: Oh, actually, I have a different view on that. And it's related to the beginning of our conversation, right? You said I think you gave a quote to the Los Angeles Times where said being the RIAA is more fun now because the consumers are on your side fighting the AI giants instead of you fighting consumers. I get that, like the valence of the RIAA and the culture may have changed. I'm sure we'll get some people in our comments saying it hasn't but in general it's changed, You're on the side of the artist fighting the giants. Google won all of those cases about fair use when it was a baby, right? They had slides in the office and they were a startup and no judge had ever used the internet before. And they're like, I love YouTube. And Viacom, you're posting your videos on YouTube because your people love YouTube and you know the audience is there. And there was something very happy about the tech industry at that time. Google as a company was a hero. I think these companies are villains now, but truly and if you look at the polling, are not beloved. AI is not beloved particularly with young people. The idea that AI is theft is not beloved with young people. That gives you an opportunity to actually turn the screws harder to say maybe you shouldn't bear these risks. Maybe the artists should be the ones getting rich, the AI companies. Are you putting that into policy or are you just trying to negotiate to an outcome?