Universal Music seeing 'tens of millions' from YouTube

Universal Music seeing ‘tens of millions’ from YouTube

January 7, 2009 Computer News

For the first time, there are signs that YouTube is driving significant revenue for itself and some of the video site’s partners. youtube_logo
Universal, the home of such acts as Akon, has a two-part licensing deal with YouTube, as do the other major labels. Under the deal, the recording companies post music videos on the site and share advertising revenue with YouTube. The two companies also share ad revenue for music posted to the site by users.
A music industry source close to the label said Universal will likely book nearly $100 million in revenue from video streaming this year. That includes video-streaming from all the of the company’s partners, i.e. iMeem, MTV and MySpace, however, most of the cash comes from YouTube.
Universal is starting to see some major cash from its deal with the video-sharing site for two reasons: first, YouTube’s recent efforts to find a business model are working. The other is that music, by far the strongest single segment on YouTube, has always been a major draw.
Among the long list of changes was last month’s announcement that YouTube would sell keyword search terms. To make the site more attractive to advertisers as well as video producers, YouTube has improved the quality of video and rolled out a test version of a wide-screen player. YouTube has improved the quality of its filtering technology so unauthorized copies of television shows and films can be removed quickly by copyright owners.
Of the top 10 channels on YouTube, 7 are music related. They include channels from Warner Bros. Records, Soulja Boy, and Disney’s Hollywood Records.