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Music companies profit from YouTube Sale

Filed in archive Internet TV by martino on October 19, 2006

or, I hope you understand this was purely physical and only a one-night stand



Music companies profit from YouTube Sale
In my daily investigations, I am always looking for the ways that businesses 'monetize' their ideas - especially for video. So, it was with fascination that I read today in the NY Times about how 3 of the 4 major music companies found a way to make money off the YouTube acquisition by Google.

You may recall that these companies are the ones that were threatening lawsuits with YouTube because of videos and songs that were illegally posted there. YouTube's deals with Universal and Sony BMG even came hours before YouTube announced its deal with Google.

It turns out that Vivendi's Universal Music Group, Sony, BMG Music Entertainment, and the Warner Music Group "each quietly negotiated to take small stakes in YouTube as part of video- and music-licensing deals they struck shortly before the salelinks." The music companies collectively stand to receive as much as $50 million from these arrangements.

But where were my friends in the television business? Later in the article it says "other old-line media companies, including CBS and NBC, which also negotiated content licensing deals with YouTube before its sale to Google, did not receive stakes in YouTube." (I am sadly disappointed that the music guys beat out the television people).

However, imitation is the sincerest form of flattery, so the deal with the music companies could result in other content companies seeing similar arrangements as a requirement before agreeing to similar pacts with YouTube.


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