“[Microsoft is] the biggest hacker in China with its intrusion into users’ computer systems without their agreement or any judicial authority,” said attorney Dong Zhengwei, who filed a complaint against the company with the Ministry of Public Security. “Microsoft’s measure will cause serious functional damage to users’ computers and, according to China’s Criminal Law, the company can stand accused of breaching and hacking into computer systems of Chinese. I respect the right of Microsoft to protect its intellectual property, but it is taking on the wrong target with wrong measures.”

So what are the “right” measures, then? Offering Microsoft (MSFT) software for free in China? Sounds like it. According to a survey of 574,923 PC users on Chinese portal QQ.com, 73.33 percent of respondents said they were using pirated versions of Windows XP, and 51.58 percent said they intend to continue using pirated versions. Just 15.55 percent said they plan to buy a licensed copy of the software.

A chart topper in 1978, Village People’s “Y.M.C.A.” has been played in thousands of baseball stadiums and karaoke bars and even performed by former Secretary of State Colin Powell at the ASEAN Forum, an annual security meeting for foreign ministers (”President Bush, he said to me: Colin, I need you to run the Department of State. We are between a rock and a hard place.”) without incident.

But its alleged popularity in file-sharing circles–particularly after the appearance last year of a YouTube video combining it with historical footage of Adolph Hitler and other Nazis–has drawn the group’s ire, as well as that of Prince, who is also reportedly part of the suit. “We are suing for damages of millions of dollars, and [suits] will be filed at both Swedish as well as U.S. courts,” Web Sheriff Chief Executive John Giacobbi told Swedish online business daily e24. “Many are asking themselves why they should be paying for content when it is widely available free of charge. But such thinking disregards the fact that someone has been creating this music or movie, and [has] invested huge sums of money in the project. Therefore it should be up to [the creators] to decide how and to whom their works are being distributed.”

Giacobbi, it should be noted, is calling upon other artists to join the suit in the hopes of giving it more critical mass and credibility, though his choice of artists may achieve quite the opposite. Said Giacobbi, “It would also be good/appropriate if the members of ABBA could take up the fight against these pirates, as they personify the Swedish music industry’s successes and are renowned ambassadors for Sweden, contrary to The Pirate Bay.”

One can only the imagine the fun the folks at The Pirate Bay, who’ve publicly ridiculed legal threats from everyone from Warner Bros. to Apple, are going to have with this one.

We do a good job of educating users about copyright law.”

–-YouTube CEO Chad Hurley, D5 Conference, 2007

I was very interested to hear Chad and Steve talking about educating consumers about copyright earlier today. Perhaps I’ve given them a graduate degree in copyright law.”

–Viacom CEO Philippe Dauman, D5 Conference, 2007

Google’s apparently finished “educating users about copyright law” and has moved on to the far more important business of making sure not to run afoul of it. After a year of delays and excuses, the company this morning uncrated an antipiracy system for its YouTube video-sharing site.

YouTube Video Identification, as Google colorfully identifies it, matches videos uploaded to YouTube against a repository of legitimate master videos provided by their owners. In the event of a violation, the system notifies the copyright holder, who can then request the video’s removal, its promotion or its ad-supported syndication. Yes, ad-supported syndication. “Like many of these other policies and tools, Video Identification goes above and beyond our legal responsibilities,” YouTube Project Manager David King explained. “It will help copyright holders identify their works on YouTube and choose what they want done with their videos: whether to block, promote, or even—if a copyright holder chooses to license their content to appear on the site—monetize their videos. In implementing this technology, we are committed to supporting new forms of original creativity, protecting fair use and providing a seamless user experience—all while we help rights owners easily manage their content.”

Ah. A “Don’t vaporize, monetize!” program (see “New From Google Labs: Google Big Friggin’ Video Ad”). Surely, just the sort of thing Viacom was hoping for when it filed that $1 billion copyright infringement suit/“mistake” against YouTube earlier this year. Well, it’s a step in the right direction, anyway. Said Viacom general counsel Mike Fricklas, “We’re delighted that Google appears to be stepping up to its responsibility and ending the practice of profiting from infringement.”

Time Warner spokesman Ed Adler offered similar sentiments. “We’re encouraged that they recognize the need to recognize copyright,” he told the Los Angeles Times. “I’m told by our general counsel that there’s still some work to be done before we would say it’s totally sufficient to protect copyright, but we’re encouraged so far.”

But not for long. Because Google’s system doesn’t prevent copyrighted content from being posted to YouTube, does it? But it may well prevent media companies from suing over it.

Citing an Institute for Policy Innovation study that estimates that copyright-industry piracy costs the U.S. economy $58 billion per year (Holy cow! That’s like Mitch Bainwol’s and Dan Glickman’s salaries combined!), Zucker called upon Congress to create dedicated intellectual-property enforcement bureaus in the Justice and Homeland Security Departments and to offer federal grants for state and local governments to escalate their own policing efforts. “The unfortunate truth is that today we are losing the battle,” Zucker said. “We need, across the board, to move IP enforcement up the agenda of the federal government. … [This issue is] absolutely critical to our economic prosperity.”

Lawmakers, especially those with musical aspirations, were predictably roused by Zucker’s spiel, though it conveniently obscured the fact that the entertainment industry’s business models are clearly in need of serious work. Said Sen. Orrin “I Write the Songs” Hatch (R., Utah, pictured with Barry Manilow, right), “Our challenge is to come up with viable economic solutions that will not only protect existing intellectual-property rights, but encourage the free flow of information and ideas necessary for creativity and innovation to thrive.”

Since it was first promised, the technology’s release date has been slipping almost as badly as that of Windows Vista. End of 2006. Early 2007. And then, this past April, “within weeks.” “We are very close to turning it on,” Google CEO Eric Schmidt said at the time. “We are testing it with two or three partners now … In a few weeks it will be available for all.”

In Google parlance “a few weeks” is apparently six months or so, because according to Google attorney Philip Beck, the company doesn’t plan to roll out the copyright-filtering technology until the fall.

Fall. Meaning late September to late December. Not exactly the hardest of deadlines–especially given the caveat Google attached to it when asked for comment. “We hope to have the testing completed and technology available by sometime in the fall,” said a Google spokesperson. “But this is one of the most technologically complicated tasks that we have ever undertaken, and as always with cutting-edge technologies, it’s difficult to forecast specific launch dates.”

That sort of backpedaling isn’t likely to go over well with Hollywood, which isn’t exactly convinced of Google’s commitment to antipiracy systems. “Saying these systems are hard to build is like saying it’s hard to build cars with good gas mileage,” Roman Arzhintar, the former general counsel and a vice president of strategy at video site Guba, told News.com in June. “Sure it’s hard, but there are plenty of things you can do to keep material off a site–even one as large as YouTube’s.”

Torrent-users can be forgiven their umbrage today over MediaDefender’s MiiVi video site. After all, an online video service owned and operated by a leading anti-piracy solutions provider would seem to have HONEY-POT written all over it. Especially given promotional text like this:

Get MiiVi now! Click here to start downloading your favorite videos now! Our members experience better services and faster downloads. Member login!”

Certainly, it seems plausible that MediaDefender–an outfit that’s responsible for flooding peer-to-peer networks with decoy files designed to frustrate users’ attempts to trade copyrighted content–might be behind a bogus torrent site established to bust movie pirates. But according to MediaDefender CEO Randy Saf, that’s not the case. MiiVi is really just a very early video site beta that should have been kept under lock and key, but wasn’t.

“It is true that MediaDefender was doing R&D on a new type of video site that we had registered under MiiVi,” MediaDefender CEO Randy Saf told Digital Daily. “All the other mumbo jumbo about working with [the] MPAA, spyware, lawsuits, etc., was a libelously fabricated story by a group of p2p blogs that are generally pro-piracy and anti-us. … MiiVi has nothing to do with the MPAA, the RIAA, or any music or movie studio. It was not even meant to be used by the general public. MiiVi has nothing to do with lawsuits. … We did not go to great lengths to hide our connection to MiiVi because we were not trying to do anything shady.”

So what was the site doing?

“Internal research and dev on a variety of software issues that are not obvious from how the site looked,” said Saf. “We were working on recommendation engines, for example. I deny on record that MiiVi collected information for legal actions. We are not working on MiiVi with MPAA/RIAA or any music or movie company for the purposes of lawsuits. We are working on recommendation engines like Last.FM. We were not scanning hard drives, or trying to trick people into downloading copyrighted content. … In hindsight, maybe we should have password-protected [the site].”

This post has been updated to include comments and clarification from MediaDefender. See our original post here.