EMI, the record company behind artists such as the Beastie Boys and the late Frank Sinatra, has become the third major label to license its content to the internet video jukebox Vevo. The label's catalogue will join those of Universal Music Group and Sony Music Entertainment, which jointly own the venture along with the Abu Dhabi Media Company, which also owns and publishes The National. EMI's arrival makes Warner Music Group the only major label not participating in the new venture, which seeks to give record companies a new revenue stream from the popularity of online music videos.
"Our agreement with EMI Music marks a milestone in our mission to provide fans everywhere with the world's best premium music video programming, when, where and how they want it," said Rio Caraeff, the president and chief executive of Vevo. The new online music service is the brainchild of Doug Morris, the chief executive of the Universal Music Group, who in recent years had argued that sites such as YouTube, which sell advertising alongside the music videos of Universal artists, ought to be sharing some of that revenue with music labels.
Vevo was created in partnership with YouTube and can be reached through searches in the popular video portal, but its video player will be able to produce images of much higher resolution and better sound quality than the typical fare generated by users on YouTube. Vevo users will also be able to make and share play lists, and the service will come with direct links for purchasing the music. Vevo's backers are counting on the proposition that this "premium" experience will command a much higher advertising rate than YouTube normally does. Mr Caraeff told Advertising Age last month that ad rates on Vevo could range from US$20 (Dh73.45) to $40 per thousand, compared with the typical web video ad rates of $3 to $8. Major advertisers such as McDonald's and Mastercard are among 20 companies that have already signed on.
The music industry has not traditionally been in the business of selling advertising, but as CD sales have declined in recent years and as even digital music sales have shown signs of flattening, the industry has had to look for new sources of revenue. Nearly three decades ago, the industry let cable juggernaut MTV use its videos without paying for them because, MTV argued, the artists were being given free publicity. But the industry is no longer in a position to let this happen again and has begun to think of its content in terms of how it can be useful to advertisers.
"With a pre-launch that includes three of the four major labels, Vevo is clearly an exciting platform for consumers," said Ricky Ghai, the executive director of the Digital Media Group. "EMI's participation is a clear indication of confidence in the Vevo business strategy." @Email:email@example.com