Music industry takes aim at YouTube

As much as the music biz needs the Internet to spread the word about bands and recordings, there remains a tension between the two that suggests they have yet to create a level playing field for doing business together. When Warner Music Group ordered YouTube to remove videos from its artists this past weekend, it served as a reminder that copyright holders not only want payment for their wares but control over promotional activities as well. Since day one, the major labels have struggled with sites that promote fan activity. And the difference in attitudes regarding content and compensation certainly drove a wedge between the music and online sides when Warner Music and AOL were still under the same Time Warner umbrella. Warner Music Group has been a leader in getting consumers to buy its music online. This year, one of its labels, Atlantic, declared itself to be the first major imprint to be generating higher revenues from digital downloads than from physical CDs. And WMG was the first major to strike a deal with YouTube. That agreement pre-dated the purchase of the video site by Google. After months of negotiations, the talks broke down last week and Warner informed YouTube that its videos need to be removed from the site. (Translation: T.I., Metallica, Madonna and Kid Rock have to be removed now, and maybe we'll get around to pulling down those who don't sell as much -- k.d. lang and Pat Metheny for example. ) YouTube is still in talks with the other majors as all of the big four signed deals more than two years ago to receive a payment each time one of their videos is streamed. The labels also share in the advertising revenue generated by the site. CONTINUE READING...