Blog Post

Blow to YouTube? UMG Wants Hub for Its Music Videos

Stay on Top of Enterprise Technology Trends

Get updates impacting your industry from our GigaOm Research Community
Join the Community!

YouTube is very good at teaching lessons to media companies. So good, that one after another they have left the site (or, you know, sued it) to try to amass web video audiences on their own terms, and make more money (or any money at all) off them. Now, it seems Universal Music Group wants to do the same thing, launching a music video portal featuring its artists’ videos and original programming, and potentially content from other labels, according to multiple reports citing unnamed sources.

That’s not to say UMG would necessarily pull its videos off YouTube, where its contract is up for negotiation before the end of this year. That relationship is reportedly expected to stay in place. Currently, UMG is by far the most popular channel of all time on YouTube, with 2.4 billion views (the next most is 250 million). According to Silicon Alley Insider, most of the company’s projected $100 million from video this year will come from YouTube. The idea of the new unnamed-as-yet site is to attract more premium ad dollars (and not have to split them with YouTube, of course).

UMG is reportedly saying the site will be “Hulu-like,” and it will be managed in partnership with a “leading media company.” But Hulu has proved unusual in its ability to attract people to a brand-new site. Media companies aren’t rarely good at providing a good user experience, and there’s no guarantee people would jump off YouTube to seek out a single label’s portal. NBC, for instance, pulled all its content off YouTube and iTunes (though the network recently reversed the latter, and Hulu now has a YouTube channel of its own), in part because it wanted to drive audiences to Hulu.

And UMG, of all labels, has not been friendly to websites that get on its bad side. It used lawsuits to help drive video sites like Bolt and Stage6 out of business, and also sued Veoh, MySpace and Grouper.

6 Responses to “Blow to YouTube? UMG Wants Hub for Its Music Videos”

  1. It is an interesting announcement, but not atypical of a big media company like UMG. I think it is a smart move for them to build their own site and potentially capture a larger percentage of the advertising revenue that they generate from their content, but they would be making a huge mistake if they took their videos off of You Tube. Having content on multiple platforms and sites is additive in terms of total views and revenue rather than hurting these numbers. Look at Seinfeld for instance, it is on constantly in TV syndication, but still sells tons of DVD’s of the same episodes that are on television, and once it is available digitally it will continue to support all the other platforms. This issue is one of major debate in Hollywood but you can’t find too many negative examples of videos where their overexposire or mass distribution contributed to their downfall.