Will Other Major Labels Follow?
(UPDATED) The cable channel that almost single-handedly popularized music videos no longer carries content from the world's largest label group. "During our recent discussions with Vevo, we were unable to reach a fair and equitable agreement for rights to stream UMG artists' music video," MTV said in a statement. "As a result, UMG has elected to pull their music videos from our Web sites. We are disappointed by this move and sincerely hope that UMG will work with us toward a fair resolution.
"The dispute comes just days after the Warner Music Group cut a special deal with MTV Networks to represent that label group's web properties to advertisers and for it's artists to be featured across the music network's cable and online channels.
Major Labels vs. Online Video plus Analysis -
"MTV has been unwilling to negotiate a fair syndication deal with Vevo to carry our artists' videos and consequently our videos will not be shown on their online properties," a UMG spokesman told CNet. In fact, the revenue share that rights holders receive from online music videos has always been a contentious issues.
Will Sony and EMI follow? Don't bet against it. After all, Sony owns a stake in VEVO along with UMG and EMI uses the startup for much of its online distribution and monetization. And Google, which own YouTube, is in it's own talks with the major label groups and other rights holders to vastly expand it's own music offering.
As with Spotify coming to the US, big labels and publisher's see this is a moment in the evolution music online during which they can seize back a portion of the revenue that they've lost in a post Napster and iTunes world.
Along the way, they need to be careful not to destroy on of their most powerful promotion channels - online music video - or even worse, to drive fans away from legitimate channels that they can control and towards sources that they could care less about paying royalties at all.