Warner Music Group ordered YouTube this weekend to
remove all music videos by its artists from the popular online
video-sharing site. Warner Music said that YouTube is “failing to
appropriately and fairly compensate recording artists, songwriters,
labels and publishers for the value they provide,” according to reports
emerging from physorg.com.
What was heralded back in 2006 as “landmark deal,” is now being thrown into disrepute by Warner Music, which seems to justify
its decision because YouTube isn’t reaching acceptable business terms. In other words, contract negotiations have broken down.
Although the slight positive comment passed by a Warner Music
Spokesman was that “they are working actively to find a resolution with
YouTube that would enable the return of our artists’ content to the
site.”
It seems the video sharing network
is losing some momentum in providing reassuring grounds for advertisers
and content providers to come and join the YouTube community.
I reported just one week ago reported
how HBO was finding a positive way to work with the YouTube community in producing a viral video for the hit TV series “Flight of
the Conchords.” But I can’t work out why Warner is backing out of a
deal with YouTube.
Are they concerned that these ad dollars just won’t appear
and that they appear, for all intents and purposes, to be giving their content away for free? When
it comes to YouTube, the main thing I think Warner should be more
concerned about is the brand they can build on YouTube.
The fact is we know they are making a ton of money from other revenue
streams and to claim that YouTube is not compensating the
artists fairly seems absurd.
I don’t have the numbers of how much money
Warner is losing or making via online video. But at one time it was
about the P2P networks. Now it’s YouTube that is causing them the
financial issues?
The key focus of any media outlet is to create a recognizable and
accessible area for online users to access and discover more about what
is going on.
I just love using the BBC YouTube channel to pick
up on the short clips of content of new shows I never knew exisited.
Now we know that the main idea behind content providers such as MGM and
Warner Music is to help share as much full length content as possible. It’s all about sharing that new song or movie and getting people’s
opinion and comment, and giving the user the opportunity to help it go
viral.
Now, if we look at figures released from a CNET.ca article,
we can see that Warner Music had a 27% share in digital music downloads which
accounted for a growth to $167 million in revenue. Now whether it may
be seen that the company is trying to encourage YouTube to send a
little link love over to Amazon MP3 and iTunes is yet to be seen.
But I
think categorically the key issue is likely to relate to the unique
advertisers yet to appear on YouTube that will help to drive some key
revenue streams for Warner, and many others if they follow suit.
