Page 170 - 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 6 UGC Platforms’ Entitlement to UGCs
An Intermediary-oriented Approach

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2006. Tik Tok was launched in 2016 and in 2018 it was valued at US$75 billion, with more
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than one billion videos viewed per day.
Considering their substantial contributions to and considerable profits from UGCs,
UGC platforms have become similar to traditional producers, except that UGC platforms
do not need to make large-scale physical copies of the works. Hence, this thesis treats UGC
platforms as quasi-producers of UGCs. The bargaining power has tilted even more towards
UGC platforms because producers in the past were generally required to pay the creators
to obtain the creations. In contrast, UGC platforms can obtain UGCs that are voluntarily
uploaded by users who do it more for personal enjoyment than for economic benefit.
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Despite the highly commercialization of UGC platforms, only 10% of UGC creators
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have profited from UGCs according to my online survey. Nicholas Carr analogised this
phenomenon to digital sharecropping: ‘the distribution of production into the hands of the
many and the concentration of the economic rewards into the hands of the few’. Although
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only a few disputes have surfaced over UGC platforms’ free sharecropping of UGCs, such
controversies are expected to rise with the increasing commercialisation of UGCs.
Section 6.2 discusses the copyrightability and authorship of UGCs and how a UGC
platform gains the right to exploit the copyright of UGCs through the Terms of Use (ToU)/
Terms of Service (ToS), which is an adhesion contract between the UGC platform and the
UGC creators. Section 6.3 and Section 6.4 analyse the conscionability of ToUs/ToSs on
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6 MediaKix, ‘YouTube Valuation: The Video-Sharing Platform Could Be Worth $160 Billion’ <http://mediakix.com/2018/05/
youtube-valuation-social-media/#gs.2h0t8z> accessed 19 May 2019; MarketSmith, ‘This Is What Google Won't Tell You
About YouTube's Financials’ <https://www.investors.com/news/technology/youtube-valuation-soaring-profits-blurry-as-
facebook-amazon-loom/> accessed 19 May 2019; Kit Smith, ‘48 Fascinating and Incredible YouTube Statistics’ (brandwatch,
4 May 2019) <https://www.brandwatch.com/blog/youtube-stats/> accessed 19 May 2019.
7 Sam Byford, ‘TikTok Owner Bytedance is Now the World’s Most Valuable Startup’ (The Verge, 26 October 2018) <https://
www.theverge.com/2018/10/26/18026250/bytedance-china-tiktok-valuation-highest-toutiao> accessed 19 May 2019.
8 See note 10 in Introduction.
9 Questions 13 and 27 in Appendix 1. There are 10.68% of the UGC creators who have get their UGCs commercialized: (25+8)/
(265+44)=10.68%.
10 Sonia Simone, ‘Digital Sharecropping: The Most Dangerous Threat to Your Content Marketing Strategy’ (copyblogger, 28
July 2015) <https://www.copyblogger.com/digital-sharecropping/> accessed 19 May 2019.
11 William & Hallisey v. American Online Communities, No. 99-CIV-3785 (S.D.N.Y. Mar. 10, 2006) Kelly Hallisey and Brian
Williams were two former Community Leaders in American Online Communities (AOL) who have spent more than 10 hours
a day in monitoring chat rooms, moderating forums and upholding AOL's ToU. In May 1999, Hallisey and Williams filed a
class action lawsuit against AOL, requiring AOL to compensate volunteers according to the Fair Labor Standards Act for their
performed works. The case was ultimately settled down. Jim Hu, ‘Former AOL Volunteers File Labor Suit’ (CNET, 2 January
2002) <https://www.cnet.com/news/former-aol-volunteers-file-labor-suit/> accessed 19 May 2019; Bragg v. Linden Lab, 487 F.
Supp. 2d 593 (E.D.Pa. 2007). Marc Bragg, a user in Second Life, filed a lawsuit against Linden Lab, the developer of Second
Life, for its unilateral closing of his account, which results in the dissolving of his virtual assets worth between US$4,000 and
US$6,000. This case was ultimately settled down.; Chang et al v. Virgin Mobile USA, LLC et al, No. 3:2007cv01767 (N.D. Tex.
2009), in which Virgin Mobile was sued for using a UGC-created photo without crediting the creator.
12 ‘An adhesion contract (also called a "standard form contract" or a "boilerplate contract") is a contract drafted by one party (usually
a business with stronger bargaining power) and signed by another party (usually one with weaker bargaining power, usually a
consumer in need of goods or services). The second party typically does not have the power to negotiate or modify the terms of
the contract’. Wex Legal Dictionary, ‘Adhesion Contract (Contract of Adhesion)’ <https://www.law.cornell.edu/wex/adhesion_
contract_%28contract_of_adhesion%29> accessed 20 June 2019. More discussion of adhesion contracts in Section 6.2.3.

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