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Warner Music and YouTube: Money for Nothing and the Vids Aren't Free
by Larson Hill
After contract negotiations broke down between Warner Music Group and YouTube over licensing rights and revenue sharing, Warner has ordered the video network to remove all Warner Music videos from YouTube. As Reuters reports, talks deteriorated on Saturday, December 20, as Warner was seeking a bigger cut in revenue potential from YouTube, which would adequately and fairly compensate all Warner artists whose material appeared on the video network. At this point, how much they were seeking is anyone's guess.
Back in 2006, a pay-per-play deal was reached between the major music companies - Warner, Universal, Sony - that would see their artists and respective label/company take a cut of advertising profits from traffic generated by the 100 million plus per month visitor giant YouTube. As Reuters reveals further, a source familiar with the negotiations stated that the revenue generated under the current deal has been "staggeringly" lower than expected..
Both representatives for Warner and YouTube have issued statements on the matter, with Warner not accepting the current structure of deal and YouTube understanding that parting ways is the best option if a mutually agreed upon business arrangement can't be worked out.
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