Music Label Hulu Rival

The four major music labels are in the midst of negotiations that could result in a new, company-indendent service for music videos, an alleged source tipping Alley Insider says. EMI, Sony, Universal and Warner are said considering a joint venture that would put all their music videos in a central location. The effort would let them tighten their control over ads and potentially generate more revenue than YouTube as well as separate its content from amateur videos that happen to share similar music.

The companies are believed frustrated by their current deals with YouTube, which provide most of their income from view counts rather than ads. An independent site would also let the labels more tightly integrate videos with direct track purchases from online music stores as well as concert tickets.

No agreement is seen as imminent and the companies are still considering alternatives, according to the claimed insider, though the current deals with YouTube will expire by early 2009 and thus leave room for changes. Any renewed deals are nonetheless expected to lean in YouTube's favor.

A major third-party site would be considered a music equivalent to the Fox/NBC joint project Hulu and has the potential to affect the popularity of music videos online, which has been helped by YouTube but is relatively limited otherwise. Outside of YouTube, some of the largest music video revenue online comes from purchases through iTunes.

By Electronista Staff