.

Warner Music, YouTube Still At Standstill Over Licensing Fees

July 21, 2009 11:24 AM ET

YouTube and Warner Music are reportedly still at work on a new contract that will bring the major label's catalog back onto the video service, Reuters reports. As Rock Daily wrote in January, YouTube hit the mute button on videos featuring music by Warner artists like Madonna and Green Day after WMG and YouTube failed to come to terms on a new deal. At the heart of the battle is WMG's desire for higher licensing fees: The company is getting roughly $3-$8 of ad revenues per every 1,000-plus views of their videos, way below the $25-$40 they want.

As Rock Daily previously reported, YouTube and Universal Music recently re-upped their agreement while also announcing plans to create a new video service called Vevo, which will feature music videos from the UMG catalog. Reuters reports that YouTube has already negotiated new deals with major labels Sony Music and EMI, leaving Warner Music as the lone holdout. While many videos by Warner-affiliated artists have been taken down and deleted off the site, some have managed to leak through onto YouTube.

The standstill comes at tumultuous time for both YouTube, which is owned by Google, and Warner Music, which is publicly traded. Album sales by artists not named Michael Jackson are down significantly, putting pressure on WMG to find additional revenues elsewhere, which is why they want more money from YouTube. Meanwhile, as ZDNet writes, YouTube is under pressure from Google to start producing more revenues. While YouTube is on pace to gross $323 million in 2009, the cost of upkeep and streaming will likely eclipse the revenue. YouTube has thus far added pre-roll ads and more advertisements on the service, but given that they are losing money it seems unlikely they'd be willing to triple the amount of money they were paying WMG for licensing in their previous deal.

Related Stories:
Universal Labels And Google's YouTube Reach Deal For New Video Service
YouTube Hits The Mute Button as Royalty Fight With Warner Bros. Continues
Warner Music Group Pulls Videos From YouTube As Talks Break Down

To read the new issue of Rolling Stone online, plus the entire RS archive: Click Here

prev
Music Main Next
Around the Web
Powered By ZergNet
Daily Newsletter

Get the latest RS news in your inbox.

Sign up to receive the Rolling Stone newsletter and special offers from RS and its
marketing partners.

X

We may use your e-mail address to send you the newsletter and offers that may interest you, on behalf of Rolling Stone and its partners. For more information please read our Privacy Policy.

Song Stories

“Nightshift”

The Commodores | 1984

The year after soul legends Marvin Gaye and Jackie Wilson died, songwriter Dennis Lambert asked members of the Commodores to give him a tape of ideas. "And the one from Walter Orange has this wonderful bass line," said co-writer Franne Golde. "Plus the lyric, 'Marvin, he was a friend of mine' ... Within 10 minutes, we had decided it should be something like a modern R&B version of 'Rock 'n' Roll Heaven,' and I just said, 'Nightshift.'" This tribute to the recently deceased musicians was the band's only hit without Lionel Richie, who had left for a solo career.

More Song Stories entries »
 
www.expandtheroom.com