YouTube and Universal: Livin’ La Vida Vevo

By Geoff Duncan April 10, 2009

YouTube and Universal: Livin

After rumors emerged last month, Universal Music Group and Google subsidiary YouTube have made it official: the two companies are working together to launch a new premium music video Web site dubbed Vevo. Vevo will be a wholly owned subsidiary of Universal, and will be supported through advertising revenue that will be split between the two companies. The hope is that by building a premium site, top music and entertainment brands will be more comfortable distributing material through Vevo than they are in the Wild-West environment of YouTube…and, of course, that Vevo will be able to charge premium ad rates for the site.

“Vevo will bring the most compelling premium music video content and services to the world’s single largest online video audience,” said Universal Music CEO and chairman Doug Morris, in a statement. “We believe that at launch, Vevo will already have more traffic than any other music video site in the United States and in the world. And this traffic represents the most sought after demographic for advertisers, especially as advertising dollars continue their shift from old media to new.”

When launched, Vevo will sport UMG’s complete catalog of premium music videos, including professional full-length videos, artist-generated content,, and user-generated content from YouTube. Vevo will sport a branded embeddable player, and Vevo-branded content will be available on both Vevo.com and a Vevo YouTube channel. YouTube will supply the infrastructure to get Vevo up and running.

The Vevo partnership could be significant for YouTube, which has faced difficulty retaining professional music video content on the service: talks with Warner Music Group broke down last year, and YouTube is blocking all music videos in the UK and Germany over royalty disputes. Although YouTube has more than 100 million users in the United States alone, music labels have been increasingly frustrated that all those viewers have not translated into more-significant advertising revenue for their content available on the service. Vevo is an attempt to pull in both big-name advertisers and top-drawer professional content, and hopefully generate more revenue for everybody involved.

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