YouTube content deals a huge win

YouTube today announced content distribution deals with CBS, Universal Music Group and Sony/BMG Music.  YouTube made a deal with Warner Music Group last month. These deals change everything. The lawsuit threat from the record labels is now much reduced, although the TV and movie people could still press individual copyright infringement suits.

At Napster we wanted to do the same thing...make deals with the record labels for digital distribution, and keep a small percentage of the revenue. It sounds logical enough but it just wasn't possible. Maybe the major labels have learned something in the last 6 years.

YouTube does video which contains music from the labels, as well as TV clips and movie clips. There are 4 or 5 major labels that control 95% of the music, so at least you know who to make deals with.

TV and movie companies are more independent. There are literally hundreds of TV producers that own the rights to individual shows. The shows may air on the four major TV networks, but they don't own the content. Individual producers own the content. Same deal with movies. There are thousands of movie producers who own the content. The big movie studios are just distribution companies...they don't own content for the most part.

YouTube will need to figure out how to make deals with all of these producers as well, or perhaps just aggressively "take down" any infringing content. Hopefully the TV and movie people will follow the lead of the music business and make reasonable licensing deals.

Things look much brighter for YouTube today.

Comments

[alan shimel]

So Don, I assume you think the Google deal is a good one now?

[Don Dodge]

No, I think the jury is still out on the Google - YouTube merger. Making the deals with the content owners is a major step forward. These deals were in the works for months and probably led Google to make the deal. I don't think it is a coincidence that the deals were announced on the same day the merger happened.

See my next post "Lessons from the Google - YouTube deal" for my thoughts on the merger.