Not every other UGC site relies almost completely on plainly copyrighted content. Examples include: Wikipedia, Flickr, Facebook, Photobucket, WordPress, Yelp, etc. Scribd is a good example of a startup taking the JTV path and I think they are scum too.
They knowingly ignore massive copyright infringement. They have negligently let their service be overrun by copyright infringement. The primary use of justintv is for copyright infringement, the UGC content is secondary. Pretending their site is just another average UGC site is intellectually dishonest.
They have exactly the same copyright policy as any other UGC site. They take down infringing stuff when they're told about it.
What's intellectually dishonest is to pretend there's such a thing as an "average" UGC site. The others vary enormously in the amount of copyrighted stuff they have on them.
"They have exactly the same copyright policy as any other UGC site. They take down infringing stuff when they're told about it."
Looks like an Everybody Else Is Doing It argument. What makes "the same copyright policy as any other UGC site" morally acceptable? It's easy to read that as "we'll make money from your content until you catch us".
There can be identical policies that produce different results. For example, a startup telling you which intersections were best for hailing a cab could have the same TOS as one telling you the best intersections to score drugs; the latter would be more likely to assist in breaking the law.