Going where the market is…

How do you deal with a youth population that’s watching your music videos illegally? Do you try to shut the sites hosting the materials illegally down? If so, how do you deal with where those youths will go next?

In a move I could never have forseen, Warner Music has decided to capitalize on the MySpace generation by going into a joint venture with YouTube. Instead of trying to bring the ever popular YouTube to financial ruin, they’ll capitalize on the userbase and allow their IP to be displayed as long as they get a share of the revenue profits. I see this as being a win-win situation for all parties involved. It is a slap in the face for Universal, however, and it will be interesting to see how they deal with these news.

Universal had engaged in discussions with YouTube, but the talks broke apart. One can only assume that the propositions put forth by Universal was not as favourable as the deal brokered with Warner Music. That said, the breakdown could of had something to do with Universal’s assertions that YouTube owed them tens of millions of dollars in royalties. Who knows.

I predict that Universal will shift its tune and try to make ammends with YouTube. Universal’s deal with the unknown SpiralFrog to distribute its videos can only spell failure; for the pure reason that it ain’t YouTube. YouTube is where the audience is, and threats of lawsuits won’t change that. Shutting down YouTube will not encourage its userbase to shift to Spiralfrog.

There’s an old Irish story about a pot of gold being underneath a pile of horse dung:

Long ago, on top of a hill nearby a small Irish village, was this pot of gold. In it were riches said to be greater than that of all villagers combined. The localmen all knew of this great pot of gold, but none dared go near it for it lay underneath a great pile of dung. Then one day, a traveller came by. He heard of the great pile of gold, said “what the feck”, and went to the hill. There he saw the great pile of dung. He dug and dug. Eventually, he found the pot. It was full of the most beautiful gold coins ever to beset any Irishman. Needless to say, he got the gold, bought the girl, and lived happily ever after.

If the labels manage to get over YouTube’s questionnable beginnings, they will have the pot of gold that lies underneath. To ignore it on the basis of that horse dung, is to ignore all the gold. They can go make another pot, they can put dung on it, but there won’t be that gold waiting for them. That’s my two cents.

PS. Yes, I did make up that story about the Irish dung.