• by Wendy Davis , Staff Writer @wendyndavis, August 16, 2007

Video sharing site Bolt has officially shuttered, after a deal to be acquired by GoFish unraveled two weeks ago.

The original deal, which had GoFish buying Bolt for up to $30 million in stock, called for Bolt to settle a copyright infringement suit brought by Universal Music Group. When the Universal settlement fell through, so did the GoFish acquisition.

Last October, Universal sued Bolt, as well as Grouper (now "Crackle"), alleging that the sites violated Universal's copyright by displaying pirated clips. The following month, the music giant filed a similar case against MySpace.

Many legal experts think the "safe harbor" provisions of the Digital Millennium Copyright Act protect video sharing sites from liability, but litigating the issue is a huge financial drain on corporations.

Google and Viacom, currently battling out this question, obviously can afford the legal fees involved in scorching the earth, but not all companies can. Bolt, for one, apparently could not.

Given the practical realities of litigating a copyright lawsuit, it's looking more and more likely that the upcoming Google-Viacom showdown will set the standard for the entire industry.