Copyright Considerations for Web Hosts - Taking Appropriate Precautions
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If you want to be covered by DMCA's "safe harbor" you need to designate an individual who is responsible for receiving infringement notices from copyright holders. That's written right into the law. The name, address, phone number, and email address of that person must be included on your web site "in a location accessible to the public," and should also be provided to the Copyright Office, which maintains a directory of these agents. There is a form you can fill out to designate an agent; you'll also have to pay an $80 fee. Think of it as an investment in your business.
Your next step is to draft and implement a DMCA policy. The DMCA itself states that you need a policy in place to deal with repeat infringers. Under the DMCA, you'll be expected to analyze and respond to initial notices, counter notices, injunctions and "repeat infringer" notices. There are web hosts that will play it safe and automatically take down material if someone says that it infringes on copyright. That's not always the best approach; for example, when Viacom demanded that YouTube take down 100,000 videos it claimed infringed its copyrights, a significant fraction of those videos were not infringing. In fact, the Electronic Frontier Foundation sued Viacom over one of the videos that it ordered taken down.
Full information about the various kinds of DMCA notices, and how to respond to them so that you are protected under the DMCA's safe harbor provisions, can be found in the DMCA itself. There's a fair bit of record keeping involved for everyone's protection, but again, this is an investment in your business. David Snead wrote an article for Web Host Industry Review that lays out what a web host's DMCA policy might include; although the article dates to mid-2005 it is still valid.
Finally, you need to make it very clear that you're complying with DMCA policy. Tell copyright holders right on your web site who they need to contact and what steps they need to take to file a DMCA notice with you. Make it easy for them, and you make it easy for yourself.
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