It is a fact (usually downplayed for public consumption) that there is a lot of por…Adult Content* on the ‘Net. Also downplayed is that as an industry it is very cutting edge in its use of new technologies, owing to the surplus funding it gets from its eager customers. It is often the “early adopter” of many later standards. However, the industry has been going through the same travails as the Mainstream from enthusiastic amateurs making free user generated content, and new services like YouPorn following in YouTube’s wake and being vast services for posting up copyrighted content.

And now it looks like its forging the way in determining how this issue will evolve – from TechCrunch:

…the U.S. District Court in the Northern District of California, threw out adult entertainment company IO Group’s 2006 copyright infringement case against Veoh today. At the time Veoh had some user-uploaded porn on its service that belonged to IO Group. Despite quick takedowns from DMCA notices, IO Group sued anyway.

A key issue of the case turned on whether or not Veoh should lose DMCA safe harbor protection because they transcoded user uploaded videos to the Flash format, something every online Flash video site does as a matter of course.

IO Group argued that the transcoding made Veoh a direct infringer and that the materials were under their direct control. Lloyd disagreed, saying “Here, Veoh has simply established a system whereby software automatically processes user-submitted content and recasts it in a format that is readily accessible to its users. Veoh preselects the software parameters for the process from a range of default values set by the thirdparty software…But Veoh does not itself actively participate or supervise the uploading of files. Nor does it preview or select the files before the upload is completed. Instead, video files are uploaded through an automated process which is initiated entirely at the volition of Veoh’s users.”

It will be interesting to see how this ruling reflects on the much higher staked Viacom / Youtube spat…..

*in fact, porn is now having to compete like never before for attention and wallet with other Adult vices like gambling.