YouTube deals hint of new era for Net media
Less than a month ago, Universal Music Group chief executive Doug Morris issued a stark warning to YouTube and other Internet companies where volumes of Universal music and video recordings have been posted without permission.
``We believe these new businesses are copyright infringers and owe us tens of millions of dollars," Morris said at an investors conference in Pasadena, Calif., in September, according to news reports at the time.
Now, Universal is playing a different tune. On Monday, the firm agreed to let YouTube post its library of music videos. In addition, people can now publish YouTube videos containing music by Universal recording artists without fear of a copyright lawsuit. YouTube yesterday disclosed similar deals to publish copyrighted materials from Sony BMG Music Entertainment and CBS Corp. Meanwhile, Internet search giant Google Inc. cut deals with Sony BMG and Warner Music Group.
These publishing agreements were overshadowed yesterday after Google agreed to buy YouTube for $1.6 billion. But the deals with several major media companies are just as important. After years of fighting unauthorized distribution of digital music and video, many major entertainment companies are ready to declare a truce.
``YouTube has demonstrated once again that the Internet is going to be the way that media is going to be popularized in the future," said Phil Leigh, president of Inside Digital Media Inc., a consultancy in Tampa, ``so you've got to get on the train now." Far from seeing YouTube and Google as havens for digital pirates, the media companies are coming to regard them as rich new sources of revenue.
YouTube's deal with CBS illustrates the new thinking. Today, a YouTube user can record a CBS program and upload a 10-minute clip to YouTube for viewing anywhere in the world. It's the kind of unauthorized copying that has long infuriated YouTube's critics. But CBS and YouTube have put together a response that protects CBS intellectual property, while still letting fans share favorite moments of ``CSI" or ``Survivor."
First, CBS will create its own YouTube ``channel," to be promoted on the front page of the site. There the firm will post popular video excerpts, including the Top 10 lists from ``The Late Show with David Letterman" and interviews from CBS News's ``60 Minutes." CBS will sell advertising that will appear on the CBS channel and split the revenue with YouTube.
Meanwhile, YouTube has developed a new technology that lets music or video companies ``fingerprint" their recordings or broadcasts, so that unauthorized copies can be detected. If someone posts an unauthorized excerpt from ``Without A Trace," YouTube's computers would detect the piracy and notify CBS.
YouTube would remove the content on request, but the request may never come. CBS spokesman Dana McClintock said his firm may leave the illegal copy alone, because CBS will get a slice of any ad revenue generated by the video. A popular clip will generate extra income for the network while promoting one of its shows.
Besides its deals from traditional media firms, YouTube is also drawing interest from online concerns. News Corp's MySpace.com, is looking for ways to expand its ties to YouTube, according to a report on The Wall Street Journal's website. Executives from the companies are slated to meet this week to discuss projects.
Roger Kay, president of Endpoint Technologies Associates Inc. in Wayland, said that traditional entertainment companies had no stomach for a rerun of their conflict with music sharing Internet services like Kazaa and Napster. Besides, said Kay, YouTube wasn't created to encourage piracy. ``The approach of Napster was to illegally distribute files, and everybody knew that from the get-go," said Kay. ``If there is any piracy on YouTube, it's incidental." This meant that the entertainment firms might have found it difficult to win a copyright infringement lawsuit against YouTube.
``In the rear view mirror, it may have been best to try to legitimize Napster, instead of opposing it," said Leigh, ``because they got stuck with all these sons of Napster." Leigh sees the deals with YouTube and Google as proof that the entertainment industry doesn't intend to repeat the mistake.
Hiawatha Bray can be reached at bray@globe.com. 