DMCA Safe Harbor protections apply to copyrighted material stored "at the direction of a user". YouTube is not making judgements about the content - if they di

DMCA Safe Harbor protections apply to copyrighted material stored "at the direction of a user". YouTube is not making judgements about the content - if they did, it would no longer be "at the direction of a user." Instead they've set up a system that lets other users (copyright holders) control content on the site. YouTube does not try to figure out whether those users' actions are valid - if they did, /then/ they could lose safe harbor. DMCA does not explicitly require ContentID type systems, but it's becoming recognized as best practice as it makes it easier to show a court "hey, we're trying to be good corporate citizens here." It also pacifies the content companies which helps prevent lawsuits in the first place. Source: currently doing research on the topic for our own service.