EMI teams up with YouTube for new revenue outlets
British music label EMI Music has teamed up with Google's online video sharing site YouTube to offer authorized music video content for the first time to interact with a new audience and monetize video content.
EMI has agreed to work with YouTube and Google to develop business models in which the YouTube community will be able to access user-generated content featuring EMI-owned and copyrighted audio and video works. EMI will track and report on this content to monetize the transaction and compensate its artists that David Bowie, Coldplay and Norah Jones. The content will be monetized through an ad-supported model.
"I think it's a step in the right direction that a service like YouTube, that didn't use to care about hosting copyrighted material, is making efforts to legitimately obtain the licenses they require," said Bob Kohn, chairman/CEO of RoyaltyShare, a San Diego-based digital royalty accounting service. "It remains to be seen whether independent record labels will be getting equal treatment and get paid for their content or if YouTube is only offering this to a company like EMI who is big enough to sue."
Record labels are looking for new ways to monetize content since CD sales, the music industry's primary source of revenue, have dropped off in recent years. Despite the fact that online music sales doubled to $2 billion in 2006, representing 10 percent of the market, these sales have not made up for the shrinkage in CD sales.
The music industry shrank last year by 3 percent, according to the International Federation of the Phonographic Industry.
Last month EMI released its entire digital library on Amazon.com's new online music store and teamed up with Apple's iTunes to be the first major label to offer high resolution digital-rights-management-free music downloads.