Vevo Gains Waner Music Artists Videos For Its App & Site Including Coldplay

[Christa42]

http://www.wsj.com/articles/vevo-gains-music-videos-in-bid-to-compete-with-youtube-1470144602

Vevo Gains Music Videos in Bid to Compete With YouTube

Vevo has struck a deal to feature some of Warner Music’s videos on its app and website

 

When Vevo LLC launched a flashy new music-video app last month it was missing one key component: all of the music videos owned by the third-biggest record company, Access Industries’ Warner Music Group.

 

But now Vevo—the video-ad-sales platform founded seven years ago by the other two major record labels, Vivendi SA ’s Universal Music Group and Sony Corp. ’s Sony Music Entertainment—has struck a deal to feature some of Warner Music’s videos on its app and website, the companies said. Warner Music isn’t taking an ownership stake in Vevo and will be able to choose which of its videos to make available on the app and website.

 

Vevo has had its own app for years, but until now, its main focus has been posting videos from Universal, Sony and others on Alphabet Inc. ’s YouTube. Vevo sells the advertising that runs with those videos, which are marked by a Vevo logo on YouTube and get about 400 million views a month, according to Vevo. Warner Music has had a direct deal with YouTube and its videos feature Warner’s logo.

 

But with CD and download sales continuing their yearslong decline, the music industry sees its music videos as an increasingly important revenue source that could bolster the modest but growing income generated by streaming services. So the record companies are trying to get fans to watch music videos on services other than YouTube, which takes a significant cut of their ad revenue while offering user-uploaded content featuring the same music at far lower rates.

Vevo and its record-label owners are hoping that the sleeker app and more complete catalog offering—including videos from Warner Music artists such as Coldplay and Led Zeppelin—will help it compete with YouTube as a go-to music video source. It is planning to launch an ad-free subscription service in the months ahead.

 

Alphabet’s Google owns a minority stake in Vevo, and “we work hand in hand with them to support artists in making connections with fans around the world,” an Alphabet spokeswoman said.

 

The deal has little downside for Warner, which had originally opted not to join Vevo so that it could retain more control over its videos while saving the costs of running an ad-sales business. All three record companies are keeping their videos on YouTube as well.

 

In a statement, Warner Music’s chief executive, Steve Cooper, said the deal would help to “unlock the true value of music videos in attracting and engaging vast audiences."