More on the Music Wars

Google and Universal Music Group have reached an agreement. Universal will be creating a new music site, which UMG will own. It will not be a separate company owned by Universal and Google as reported in the body of the original article.

Anyway, here are the highlights of the agreement:

YouTube and Universal to Create a Hub for Music
April 9, 2009

SAN FRANCISCO — YouTube,
the most popular online video site, and Universal Music Group, the world’s largest music company, said on Thursday that they would create an online hub for music videos and related content, called Vevo.

Music videos of Universal’s artists will be available both on Vevo.com, which will be owned by Universal and powered by YouTube’s technology, and on a Vevo channel on YouTube. The companies said they would share revenue from advertising on both sites, but declined to discuss specific terms of the agreement.

Google and Universal said they planned to introduce Vevo this year. They said they were working to persuade other major labels to join the site.

Industry executives and analysts said the partnership appeared to be an effort to emulate the success of Hulu, an online joint venture between NBC and Fox for television shows and movies.

Ugh, NBC and FUX, what a satanic combination! The fundies will be happy.

While Hulu’s audience is much smaller than YouTube’s, the site has been able to attract major advertisers who view YouTube’s eclectic collection of video clips with some trepidation.

The agreement also renews a license allowing YouTube’s users to include Universal’s soundtracks in their videos. If successful, Vevo could compete with other online sites for music videos, including MySpace. But analysts said it was too early to predict whether music fans would flock to the site.

“It takes more than a premium-content destination to really build a business,” said Ross Sandler, an analyst with RBC Capital Markets. Mr. Sandler said fans could end up choosing to watch music videos on YouTube rather than on Vevo.

Particularly if YT's users are to be allowed to resume using UMG material. Who needs to watch the music company's commercialized videos over and over and over when the same music accompanies a variety of mvids elsewhere? Besides, the discussion on purely music videos tends to be truly inane — "he's hot", "she gives me a boner" (This is the ultimate in narcissism — who but the commenter cares about his plumbing?), "I don't like that dress / hairstyle / whatever", "someone else's version is better".