Several recording companies signed deals with YouTube and Google for displaying music videos online, in moves that could avoid the type of copyright infringement litigation that has dogged the digital music industry.
On Monday, Sony BMG Music Entertainment and Warner Music Group both signed deals with Google to include their music videos on the Google Video Web site. Internet users can watch the videos for free and Google and the record companies will share revenue from advertising.
In addition, the companies will allow other Web sites that use Google's AdSense advertising platform to display videos on their sites. As an example, Google imagines that a fan site dedicated to a particular band can run ad-supported videos from the group on its site. Google, the music company and the Web site publisher will split the revenue.
Google will also sell Warner videos for download from Google Video in the U.S. for $1.99.
On Monday afternoon in Europe, many Sony videos were available to view for several seconds after which users were asked to pay $1.99 to download the video. Advertising wasn't apparent on the site and many videos opened to a screen that read: "This video is currently not available. Please try again later."
Google also said it is working with both record companies to develop a system to allow users to access record company content for use in their own video creations.
YouTube Cuts Deal
Separately, Sony and Universal Music Group (UMG) both announced agreements on Monday with YouTube to make their music video content available on the popular video-sharing Web site.
The companies said that new YouTube technology, announced recently, will filter out content from UMG and Sony that is not authorized to appear on the site.
The record companies and YouTube also said that they'll license content to YouTube users who may want to include it in their own content creations.
The deals appear to address recent record company complaints about unauthorized content on YouTube. Some onlookers, including Forrester Research analyst Josh Bernoff, have suggested that record companies will sue YouTube for copyright infringement and win, similar to the way early digital music companies have lost suits to the same record companies.
While Monday's announcement would appear to avoid the potential of such lawsuits, the deals aren't without a downside. In a blog posting two weeks ago, Bernoff warned that deals like those made today that remove copyright content will make sites like YouTube far less interesting to users. He also suggests that while some media companies will make such deals, they all won't and the remaining companies could pursue legal action.
The agreements also show that the record companies are interested in trying different models for selling their content in an attempt to find which earns them the most money.
"It's indicative of the larger experimentation we're seeing online," said Nate Elliott, an analyst with Jupiter Research. The music companies, for example, sell pieces of content individually, on a subscription basis or in an advertising supported model. "I don't think any of them know which will work. Everyone is making sure when this all starts to generate real money, they know what they're doing," he said.
Late last week rumors surfaced that Google is negotiating to buy YouTube for $1.6 billion. The Google Video site has lagged compared to the widely popular YouTube.