YouTube strikes royalty deal
2007-08-30 15:06
London - Music artists from Cliff Richard to Amy Winehouse will be paid when their tracks are used as backing music for clips on video-sharing website YouTube following a deal with the British society that collects royalties for 50 000 composers, songwriters and publishers.
The MCPS-PRS Alliance said on Thursday that it has agreed to licence more than 10 million works of music to Google Inc-owned YouTube under a flat licence for use on the British version of the website. Both the MCPS-PRS Alliance and YouTube declined to disclose monetary terms of the deal, but analysts suggest it could run into the tens of millions of pounds.
The agreement will help compensate artists for income lost from declining CD sales, but it also provides a defence for YouTube against challenges by major media companies that the site is a haven for piracy of their copyrighted works.
Similar interim agreements by music royalty societies have been reached in the United States while they hash out complete deals, but Wednesday's is believed to be the first full agreement.
The move comes just a day after NBC Universal and News Corp gave their rival video-sharing site a name and a trial date, indicating it is closer to a full launch.
Andrew Shaw, the Alliance's managing director for broadcast and online, said the deal with YouTube would cover both user upload and content.
'new and creative ways to compensate music creators'
Shaw said that YouTube was in a unique position among broadcasters as it did not have full awareness of content on its site and that it had agreed to explore and implement technology to search out music.
"We do have an agreement from them to put in place various technologies that will allow them to identify music that is being used, to report that back and to make appropriate distribution payments," he said.
Chad Hurley, CEO and Co-Founder of YouTube said the deal was an example of its efforts to "explore new and creative ways to compensate music creators".
Shaw acknowledged that keeping tabs on the millions of videos available on the site would be a difficult task, "with a long tailend", and the aim was to identify as much as possible.
The Alliance will decide how to distribute the revenues to its members based on an estimate of the level of usage.
Shaw said the deal was the first step of "getting into business" with YouTube and could eventually be renegotiated if and when usage of the site changes.
- AP