The largest music company in the world, Universal Music Group, has reached an agreement with YouTube to create an online platform for music videos, to be called Vevo. The agreement is said to include the licensing of Universal recordings to be used in user-generated videos on YouTube.
This is the latest of efforts on behalf of YouTube to offer a larger spectrum of content to its mammoth audience. YouTube is owned by powerhouse and major player Google, who is also the leader in the search market. In the agreement, Universal Music Group and Google are to share revenue generated from advertising on both websites. Vevo’s anticipated release is later this year, with ongoing negotiations with other major labels to potentially join in.
Being backed by Google certainly will not hurt Vevo, who will naturally acquire traffic and attention from prior media interest and user anticipation. Vevo will have the capacity to deliver high quality music videos to the largest online video audience, an impressive task. Down the line, users will be able to purchase merchandise and concert tickets on Vevo.
In 2006 and 2007, music companies were among the first to license their content on YouTube, in large part because music videos are popular on the site. The new relationships emerging from changing technology are redefining business models as we knew them, transforming them into streamlined modern marvels that are above all, user-friendly. Brought to you by Blue Interactive, your Fort Lauderdale interactive marketing, web design and branding firm.