Wednesday, September 20, 2006

YouTube Will Pay Warner Music Group Royalties

by Gavin O'Malley
published September 18, 2006

NEW YORK ( -- Winning over another would-be foe, YouTube has reached a revenue-sharing deal with Warner Music Group, which will now distribute and license its copyrighted content through the hugely popular video-sharing site.

Warner can now expect an undisclosed share of ad revenue whenever YouTube users stream a video containing the company's intellectual property. If, for example, an amateur auteur borrows a snippet of Madonna's latest video, or scores their short with a track from Missy Elliot's new album, Warner is now guaranteed compensation. To make this possible, YouTube developed a royalty-tracking system that detects when homemade videos are using copyrighted material.

Universal's lawsuit threat
The announcement comes less than week after Universal Music CEO Doug Morris threatened to sue YouTube over its failure to prevent copyright violations -- still a common reaction for record labels, movie studios and TV networks anxious to protect old business models.



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