WMG Removes Vids From YouTube

Negotiating

Negotiations between WARNER MUSIC GROUP and YOUTUBE over renewing the licensing agreement for the record label's music videos broke down on FRIDAY, reports CNET.COM. Early SATURDAY morning (12/20), WARNER, the third largest record label removed videos from the GOOGLE-owned video site.

The impasse comes at a time when all four major labels, including UNIVERSAL MUSIC GROUP, SONY MUSIC and EMI, are renegotiating their licensing deals with YOUTUBE.

"We are working actively to find a resolution with YOUTUBE that would enable the return of our artists' content to the site," WARNER said in a statement. "Until then, we simply cannot accept terms that fail to appropriately and fairly compensate recording artists, songwriters, labels and publishers for the value they provide."

YOUTUBE has become an important revenue stream for at least one of the top labels. This week, RIO CARAEFF, UNIVERSAL MUSIC's digital chief, told CNET NEWS that YOUTUBE is generating "tens of millions" of dollars for the recording company this year, up 80% from last year. CARAEFF said that UNIVERSAL and YOUTUBE enjoy a strong relationship and that the companies are trying to expand their relationship beyond music videos. A source close to UNIVERSAL said that the label will likely book nearly $100 million in video-streaming revenue -- most of it from YOUTUBE.

By pulling out of the deal with YOUTUBE, WARNER loses access to the Web's #1 video site, which topped 100 million visitors in OCTOBER. The site has increasingly become one of the Internet's favorite ad-supported juke boxes. Of the top 10 YOUTUBE channels, 7 are music related. WARNER BROS. RECORDS is the 11th largest channel.

"If we can't reach acceptable business terms, we must part ways with successful partners," GOOGLE said on its blog. "For example, you may notice videos that contain music owned by WARNER MUSIC GROUP being blocked from the site.

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