Vevo is getting ready to expand to the U.K. within the next few weeks, according to a Guardian report. Vevo CEO Rio Caraeff told the audience of the Abu Dhabi Media Summit that the major label-backed music video platform is “planning to launch in the U.K. imminently,” and the paper quotes unnamed sources saying that a launch could come before the end of March.
Launching in the U.K. makes sense for Vevo. The music market there is very similar to the U.S., and the country is home to major label EMI, which has licensed its content to Vevo without owning a stake in the company. Moreover, the U.K. has proven to be a fertile ground for online music ventures. Napster started its international expansion by targeting Britons, CBS (s CBS) went to London to buy Last.fm, and Spotify has its headquarters in the U.K..
However, Vevo’s world domination plans don’t stop there. The music video venture plans to expand to the Middle East and North Africa in the next few months, which can be attributed to he United Arab Emirates-based Abu Dhabi Media Company’s co-ownership of Vevo. Further expansion into Europe, Brazil and Australia is planned for the second half of this year or later.
Those steps are a big deal for Vevo, but they also raise questions a number of questions: Why can the venture pull off what Netflix, (s NFLX) Hulu and other online video services haven’t been able to? Hulu in particular has been talking for years about international expansion, but no signs point to any imminent move beyond the U.S. market. Netflix started its international expansion last year by opening shop in Canada, but a potential move towards Europe also seems to be taking its time.
The main reason Vevo can expand more aggressively is content rights. The two other co-owners of the venture are Sony Music (s sne) and Universal (s ge) (s cmcsa), and both major labels own the international rights to the music videos shown on Vevo. That’s very different from Hulu for example, despite the fact that it is also owned by major media entities. Hulu’s owners, which include NBC, Disney (s DIS) and Fox, (s NWS) license their content to TV networks in foreign markets — and those networks don’t want to see competition for the same content online.
However, Vevo’s international expansion won’t come without stumbling blocks. One of the issues the platform will have to deal with are performing rights organizations, which license the rights to the compositions for songs featured in music videos.
Vevo’s partner, YouTube, has been successful at striking deals with some European performing rights organizations, but others are playing hardball. Germany’s rights group GEMA has pressured YouTube (s GOOG) to block hundreds of music videos for German visitors, and both parties are currently engaged in legal proceedings about licensing fees. Vevo likely won’t come to countries like Germany until those issues are resolved.