Are "Let's Play" Streams Legal?

A lengthy article on Ars Technica takes an in-depth look at what they call the "(still) uncertain state of video game streaming online." They discuss the topic with some streamers, and probably more pertinently, with a lawyer, to try and shed some light on the murky legality of profiting from broadcasting content created by other people (thanks Neutronbeam). Here's a bit:
According to Ryan Morrison—founding partner of Morrison/Lee, a firm that’s practice areas include the DMCA, streaming and YouTube, and video games —there are presently multiple schools of legal thought on both sides.

"I think the most legally accurate response right now is that Let's Play videos and most streams are derivative works and therefore infringing if you don't have a license from the publisher or game developer," Morrison says. But the attorney added that there is a fair use argument that streamers could make, but fair use is a defense that essentially admits to infringement and tries to explain why that use is OK.

"That's super expensive to prove," Morrison says. "A judge has to be the one to say it's fair use, and you can spend six figures to get there, and it's certainly not a black or white line that you can just OK. So, keeping that in mind, without a license and without the permission of the publisher or developer, streaming is infringing—as are Let's Play videos."

Morrison wasn't currently aware of any cases, but he expects they're coming. But currently all the power is in the hands of publishers and developers. And while some may believe that if they aren't making money off a project they are legally sound, Morrison says otherwise.
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Jan 30, 2018, 07:47
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For every negative Youtube review of any game there seem to be 10 times the number of let's play videos that show the game in a positive light.

Free advertising, and in some cases, profitable, as Youtube has algorithms that ID biggie content (from companies like Nintendo) within lets plays and compensates them.

Taking action in this situation would have the result of few if any positive depictions of the game online, but all the negative reviews would still be there as criticism is mostly legal.
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