U2’s Bono has managed to broker a deal that merges Universal Music Group (the largest record distribution outfit on the planet) withYoutube that now allows for the creation of a dedicated channel to advertise the label’s artists. The channel, to be called Vevo, will debut later in 2009 and will feature content provided by Universal. The joint venture, apparently derived by Bono during a dinner with UMG’s CEO Doug Morris, is expected to produce revenue through outside advertisements, similar to the commercials seen on sites such as Hulu that viewers must endure before seeing the content they are seeking.
While the partnership aims to be beneficial to both parties, it must be remembered that this is not an altruistically minded, joint endeavor. The new channel will be wholly owned by UMG, although both companies will share start up costs. The venture has been deemed as necessary by UMG, as album sales thus far in 2009 are down 45 percent from 2000, according to Nielsen SoundScan.
Van Halen’s defacto label, Time/Warner, has found itself mired in a year long dispute with Youtube (leading to the removal of Warner Brothers’ content, as reported by the VHND here). The label has recently announced a partnership with Adobe Systems, makers of Flash and video tools for the internet, in anticipation of a possible video site to feature Warner Brothers artists. As a result, the recently pulled Van Halen and other WB artists that have disappeared from Youtube may actually have a new home in the coming months.