Monday, August 16, 2010

Universal Music Group Cuts Ties With MTV Networks, Will Show Videos Exclusively On VEVO

Not sure if MTV's online network was your preferred source for music videos and clips in the first place, but if your looking for content from Universal Music Group artists specifically, you're going to have to look elsewhere.

From Wall Street Journal:

Universal Music Group pulled its music videos from MTV’s websites starting earlier this week, the two companies said Friday, as talks over new licensing terms broke down.

While many details of the breakdown weren’t disclosed, MTV Networks has been in negotiations with Vevo, the Hulu-esque video service owned by Universal , Google and Sony Music. MTV previously licensed music videos directly from record labels for use on, and Now Universal, Sony and EMI want websites to let Vevo “syndicate” its videos through their sites. Under that arrangement, which is already in place on YouTube and several other sites, Vevo sells its own ads and delivers its members’ videos through a branded player. Website owners like MTV parent Viacom Inc. get a cut of the advertising revenue.

In a statement, Universal said: “MTVN 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. We believe that using Vevo as our online music video syndication platform is the best way to maximize revenue for our artists, our songwriters and ourselves.”

The dispute doesn’t affect the ability of MTV’s cable channels to air videos from Universal artists.

While it’s not clear what the sticking point was, it probably relates to the attempted insertion of a new entity in the value chain between consumer eyeball and content owner. In other words, it’s not hard to imagine that MTV balked at the possibility of making less money so that a new company controlled by the record labels could get cut into the deal. Representatives of MTV and Universal declined to comment on financial details.

In a statement of its own, MTV Networks said: “we continue to seek out new and innovative ways to connect artists with their fans that are mutually beneficial to everyone. However, during our recent discussions with Vevo, we were unable to reach a fair and equitable agreement for rights to stream UMG artists’ music video content.” The company added that it was “disappointed” by Universal’s decision.

Also notable: MTV recently entered a partnership with Warner Music Group, the other major-label group, that represents an alternate—and competing—approach to selling ads that run with online music videos.

For now, the impasse applies only to Universal videos, because that company’s previous licensing deal with MTV expired last month. But Sony’s deal comes up for renewal in the fall, and if no deal is in place by then, Sony’s clips good be next to go dark at

Just in case you skimmed through and didn't read, no, this doesn't mean that MTV won't be showing music videos from UMG artists (do they still show videos?). It means that they won't be showing them online, nor will they be showing performance clips to coincide with interviews and other content.

VEVO is owned by Sony Music Entertainment and Universal Music Group, hosts its videos through YouTube while Google and Vevo share the advertising revenue. Sony's deal with MTV Networks is up for renewal in the fall.


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