Considering starting a site on which you let visitors post comments and content? You must protect yourself legally, which means you need to comply with the DMCA safe harbor provisions to avoid copyright infringement claims.
Any site allowing users to upload comments or content is known legally as a “user generated content” site. In legal arenas, this is shortened to “UGC”.
From a business perspective, a UGC site is a tremendous model. Think about it. The users provide nearly all the content, and they do it for free. Consider Wikipedia for a minute. The site has approximately 30 million pages. How many of those were created by employees of the site? A miniscule percentage.
Of course, Wikipedia is not a for-profit site. Facebook is. When it started trading stock in the markets, it was valued at over $100 BILLION. That is 100 billion dollars built off of free content provided by users. Is there any doubt why everyone and their brother seem to be launching a UGC site of one sort or another these days?
As with any great business idea, there are risks to take into account. With UGC sites, the biggest risk is a member will upload copyrighted content without the permission of the copyright owner. The copyright holder can sue for infringement with damage claims being as high as $150,000 per infringement. For example, the posting of four infringing images on your site would equate to a damage claim potentially as high as $600,000.
1998 was a great year for the web. Why? A number of laws were passed that created a foundation for the explosion of new types of internet platforms including UGC websites. The Digital Millennium Copyright Act of 1998 was one of those laws. It was particularly important because it created a copyright safe harbor for UGC sites and continues to do so today.
The “DMCA” facilitates UGC sites by protecting them from copyright infringement claims. The protection only applies to infringement claims seeking monetary damages, but this equates to nearly every infringement lawsuit. Regardless, the UGC site can avoid such claims even though a member is explicitly committing copyright infringement.
If you are considering allowing people to post anything on your site, make sure you comply with the DMCA safe harbor provisions. Contact me to get set up and protected.
Richard A. Chapo, Esq.
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