Under pressure from the major media companies and the threat of a billion dollar suit from Viacom, Google unveiled a new system that would prevent copyrighted clips from being uploaded to YouTube without permission.

Google said it had been testing the system with nine media companies, including Time Warner, CBS and Disney. Others involved include NBC Universal and Viacom, according to people with knowledge of the tests. YouTube representatives said the system was able to identify clips that were identical to those in its database, as well as those that had been slightly modified by users to escape detection. To demonstrate, they showed a positive identification of a clip that had been captured by a camera filming a television set as the clip was being shown.

While Viacom is sounding an optimistic response ’cause you know, they’re holding the gun, other companies and consumer groups are skeptical. The system uses a digital “fingerprint” to identify illegal clips. But applying the technology would require media companies to submit their digital video files to Google. That’s a lot of files in the hands of one company.

Louis Solomon agrees. He’s a partner in Proskauer Rose, which represents the Football Association Premier League of England, a lead plaintiff in a class-action copyright suit against Google.

“It gives YouTube and Google content that they don’t need and shouldn’t have,” he said.

And consumer groups worry that Google’s new system could prevent uploads of video clips that were authorized under “fair use” provisions of copyright law.

While the main objective is to block illegal clips. Google is of course offering to promote the clips and share revenue from the ads placed around them. This is akin to paying Google for protection from a system that Google owns. That’s a lot to ask of the entire industry, even for a company that’s trading above $6oo a share.

For the first time in its history, Google has entered into an adversarial relationship with its users. The young upstarts who took on the establishment of Yahoo and Microsoft are unwittingly becoming “the Man”.

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