The storm in a teacup which saw everyone, YouTube, Warner, and viewers, lose out when music videos were pulled from the video-sharing site is over.
YouTube and Warner Music Group have now forged a new deal which will see WMG having its own branded player and able to sell its own advertising inventory.
Warner Walks Away
It was late December 2008 when Warners decided to pull all its music videos from YouTube. It happened due to a breakdown in communications while the two parties were trying to thrash out a new licensing deal. The ones that had been in place for years were coming to an end.
As always, it came down to money. The Warner Music Group wanted a bigger slice of the revenue pie and YouTube was unwilling to deliver. Regardless of who was right and wrong, the incident helped no one in the end.
The Vevo Factor
Talks have continued on since then, and a deal has been rumored for a few months. In the meantime, YouTube has inked new deals with the other three major record labels, Sony, Universal, and EMI.
The last nine months has also brought news of a new venture called Vevo, which is best described as a Hulu for music videos. Vevo will see many music videos disappear from YouTube only to reappear on a separate, YouTube-backed site.
Warner Welcomed Back
Yesterday saw YouTube finally confirm it had settled the argument and signed a new deal with WMG. All the record label’s many music videos, including by artists such as Green Day, REM, Madonna, U2, Red Hot Chili Peppers, and Kid Rock will make their way back on to the Google-owned site.
Warner has managed to secure an arguably better deal than the other record labels by holding out for better terms. Details are still a little sketchy at this point but there will be a Warner Music Group branded player and the company will be able to sell its own advertising inventory.
YouTube will still take a cut but the margins are clearly going to be in Warners’ favor.
Conclusions
This is good news for all parties, as YouTube gets those all-important music videos back and WMG gets another revenue stream back. Viewers, of course, also benefit as they are no longer denied the chance to watch their favorite music videos.
The only question left is where Vevo sits in all this. While the other labels are moving away from YouTube to the new site, Warner now looks to be entrenched on it.
