When Google bought YouTube, did it buy copyright troubles? Slate’s Tim Wu wrote that YouTube appears to enjoy "safe harbor", unlike Grokster and Napster.
In 1997, the Online Copyright Liability Limitation Act, which became Title II of the Digital Millennium Copyright Act of 1998 (§512 of the Copyright Code), made companies like YouTube and other Web 2.0 companies possible.
Section 512(c) of the law applies to "Information Residing on Systems or Networks At Direction of Users." Examples of user generated content sites now include Wikipedia, Flickr, Facebook, and MySpace.
These companies are protected by a "notice and take down" system when they host user content. When the company receives notice of an infringing copy, the intellectual property owner writes a letter to the company and demands that it take down the copy. As long as the company acts expeditiously and was not already aware that the material was there, the company is in a "safe harbor."
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