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, lawyers shorten the phrase 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 minuscule percentage.
Of course, Wikipedia is not a for-profit site. Facebook is. When it started trading stock in the markets, financial gurus valued the company at over $100 BILLION. Yes, free user content built that 100 billion dollar business. 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 significant business idea, there are risks to take into account. With UGC sites, the most significant threat 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 an excellent year for the web. Why? Congress passed several laws 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. You can contact me for more information about our DMCA compliance service.
Richard A. Chapo, Esq.
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