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Updated: Warner Close To Deal With YouTube, In Early Talks With Vevo

Updated: Have Warner Music Group (NYSE: WMG) and YouTube finally negotiated a deal that will bring music videos from artists like Madonna and U2 back to the video site? That is what AdAge is reporting, citing sources familiar with the talks. Warner pulled all of its artists clips from YouTube in December, after the two companies could not agree on new rev-sharing terms. But sources tell our co-editor Staci D. Kramer that while a deal is close, it has not been completed. YouTube and Warner declined comment.

At the same time, talks have started between Warner and Vevo, the new music video JV between *Universal Music Group* and *Sony*, but are still in the early stage. With YouTube powering the back-end for the site, WMG isn’t likely to get in too deep with Vevo until it is certain of an agreement with the Google (NSDQ: GOOG) video portal. Even then, a deal may not happen. AdAge says Warner is seeking a non-exclusive deal with Vevo — not an equity stake in the music video site — as part of a broader overall strategy that could include touchpoints on its Cisco-powered social network. But our understanding is that determination has yet to be made and that talks have not progressed that far. More as warranted.

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