Page 17 - A Study on the Role of UGC Platforms in Copyright Law：An Intermediary-oriented Approach

A Study on the Role of UGC Platforms in Copyright Law: Chapter 1 Introduction
An Intermediary-oriented Approach

The large audiences on UGC platforms and the power of peer distribution suggest that
UGC platforms can play an active role in increasing the exposure to UGCs and enhancing
the popularity of their content. Many start-up creators, who want to commercialise their
work but have not obtained support from professional producers (e.g. publishing houses,
record labels and film studios), can upload their content to UGC platforms to ensure that
16
it is distributed as widely as possible. UGC platforms even help to promote UGCs. For
example, they provide a shared value system that includes ranking, grading, a ‘thumbs up’
function and reputation enhancement to incentivise UGC creation. Some UGC platforms
have even developed remuneration schemes to encourage UGC creation, although only a few
of the most popular UGC creators have benefitted from it. The highest paid YouTube star,
17
Ryan ToysReview, received US$22 million in 2018. In short, UGC has turned from a non-
commercial amateur activity into a lucrative copyright business.
Despite this change, the current copyright law has cast a shadow over the sustainable
development of the thriving UGC industry. It decreases the incentive to create UGCs,
especially user-derived content. In addition, with the potential profitability of UGCs,
copyright owners are likely to change their strategy from tolerating UGCs to filing actions
against the most lucrative content. They can also take down a UGC by putting the UGC
platform on notice, even if they know that the UGC constitutes fair use. Owners can use
ex-ante strategies such as technical protection measures to hinder the use of or even access
to the copyrighted material. Further, even if a UGC can be created and uploaded, it may
be exploited by UGC platforms, usually without compensation. This is due to a lack of
regulations governing the platforms’ use of UGCs, which in turn has resulted from the
general presumption of most national copyright laws that Internet service providers (ISPs)
serve as passive, neutral conduits or hosts for the content they transmit or host. 18
The copyright owners of pre-existing works on which UGCs are based may find it
difficult to obtain compensation for the use of their works. The safe harbour doctrine, first
established under the Digital Millennium Copyright Act (DMCA) in the US and quickly
adopted by many other jurisdictions, has exempted UGC platforms from liability for
19
copyright infringement by platform users. Despite the courts’ stated sympathy for copyright
owners, the statutory protection for online service providers has forced the owners to
abandon their long-standing tradition of targeting deep-pocket intermediaries. Rather, since

16 Daniel Gervais, ‘Authors, Online’ (2015) 38 Columbia Journal of Law & the Arts 385, 391. The students from Nanyang
Academy of Fine Arts that I interviewed express their intention to publish their works in UGC platforms to open their
markets.
17 Caitlin O'Kane, ‘Top 10 highest-paid YouTube stars of 2018’ (CBS News, 4 December 2018) <https://www.cbsnews.com/
news/top-10-highest-paid-youtube-stars-of-2018-forbes/> accessed 15 May 2019.
18 H. Rept. 105-551 (II), at 51 (1998).
19 Michael L Rustad and Thomas H Koenig, ‘Harmonizing Cybertort Law for Europe and America’ (2005) 5 Journal of High
Technology Law 13, 14.

• 3 •