Less than a month ago, Universal Music Group chief executive DougMorris issued a stark warning to YouTube and other Internet companieswhere volumes of Universal music and video recordings have beenposted without permission.
"We believe these new businesses are copyright infringers and oweus tens of millions of dollars," Morris said at an investorsconference in Pasadena, Calif., in September, according to newsreports at the time.
Now, Universal is playing a different tune. On Monday, the firmagreed to let YouTube post its library of music videos. In addition,people can now publish YouTube videos containing music by Universalrecording artists without fear of a copyright lawsuit. YouTubeyesterday disclosed similar deals to publish copyrighted materialsfrom Sony BMG Music Entertainment and CBS Corp. Meanwhile, Internetsearch giant Google Inc. cut deals with Sony BMG and Warner MusicGroup.
These publishing agreements were overshadowed yesterday afterGoogle agreed to buy YouTube for $1.6 billion. But the deals withseveral major media companies are just as important. After years offighting unauthorized distribution of digital music and video, manymajor entertainment companies are ready to declare a truce.
"YouTube has demonstrated once again that the Internet is going tobe the way that media is going to be popularized in the future," saidPhil Leigh, president of Inside Digital Media Inc., a consultancy inTampa, "so you've got to get on the train now." Far from seeingYouTube and Google as havens for digital pirates, the media companiesare coming to regard them as rich new sources of revenue.
YouTube's deal with CBS illustrates the new thinking. Today, aYouTube user can record a CBS program and upload a 10-minute clip toYouTube for viewing anywhere in the world. It's the kind ofunauthorized copying that has long infuriated YouTube's critics. ButCBS and YouTube have put together a response that protects CBSintellectual property, while still letting fans share favoritemoments of "CSI" or "Survivor."
First, CBS will create its own YouTube "channel," to be promotedon the front page of the site. There the firm will post popular videoexcerpts, including the Top 10 lists from "The Late Show with DavidLetterman" and interviews from CBS News's "60 Minutes." CBS will selladvertising that will appear on the CBS channel and split the revenuewith YouTube.
Meanwhile, YouTube has developed a new technology that lets musicor video companies "fingerprint" their recordings or broadcasts, sothat unauthorized copies can be detected. If someone posts anunauthorized excerpt from "Without A Trace," YouTube's computerswould detect the piracy and notify CBS.
YouTube would remove the content on request, but the request maynever come. CBS spokesman Dana McClintock said his firm may leave theillegal copy alone, because CBS will get a slice of any ad revenuegenerated by the video. A popular clip will generate extra income forthe network while promoting one of its shows.
Besides its deals from traditional media firms, YouTube is alsodrawing interest from online concerns. News Corp's MySpace.com, islooking for ways to expand its ties to YouTube, according to a reporton The Wall Street Journal's website. Executives from the companiesare slated to meet this week to discuss projects.
Roger Kay, president of Endpoint Technologies Associates Inc. inWayland, said that traditional entertainment companies had no stomachfor a rerun of their conflict with music sharing Internet serviceslike Kazaa and Napster. Besides, said Kay, YouTube wasn't created toencourage piracy. "The approach of Napster was to illegallydistribute files, and everybody knew that from the get-go," said Kay."If there is any piracy on YouTube, it's incidental." This meant thatthe entertainment firms might have found it difficult to win acopyright infringement lawsuit against YouTube.
"In the rearview mirror, it may have been best to try tolegitimize Napster, instead of opposing it," said Leigh, "becausethey got stuck with all these sons of Napster." Leigh sees the dealswith YouTube and Google as proof that the entertainment industrydoesn't intend to repeat the mistake.
Hiawatha Bray can be reached at bray@globe.com.
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