Universal Music boss slams YouTube
What are they putting in the water at that Merrill Lynch Media & Entertainment Conference in Pasadena? First, News Corp. boss Peter Chernin annoyed the Web 2.0 crowd with his off-key vision for MySpace, and now Universal Music head Doug Morris has used his conference talk to essentially threaten YouTube and MySpace over copyright infringement. (Can't we all just work on growing the pie instead of fighting over how to carve it up?)
ln any event, Morris' public sabre-rattling represents the first major move against YouTube, which has long flirted with trouble given the prevalence of copyrighted materials on its site. "We believe these new businesses are copyright infringers and owe us tens of millions of dollars," Morris said, adding: "How we deal with these companies will be revealed shortly." Alex Veiga of the AP, who broke the story, suggests that Morris' get-tough remarks are "a signal that negotiations could be stalled between the world's largest record company and the two online sites." No doubt. Interestingly, Morris appears to be the industry spoiler. Veiga notes that Universal's rival, Capitol Records, has released videos on YouTube, while Universal "has made it a priority to get compensation for content that was once seen as purely promotional." Naturally, the blogosphere is not impressed. Jeff Jarvis at BuzzMachine gets worked into more than his usual lather: "These dimwits just don't get it: YouTube and MySpace and blogs and the internet are their new distribution and sales channels. Want to cut off your noses to spite your faces? Fine. Here's the knife." Most Slashdot readers are right there with Jarvis, though the most fatalistic among them are already assuming that YouTube will get Napstered - that is, sued more or less out of existence. Not likely we think: YouTube has lots of friends in old media, and its sins are far less egregious than Napster's. But, even if so, what do the Slashdot types think will happen then? Says one: "It'll take about a month for all the users to migrate to one of the dozens of alternative sites that act in the same way and have slightly different features." Does it seem like we've seen this one before? UMG just wants a bit of the pie for content that it is - in a backwards kind of way - supplying. This is all just a negotiation tactic and YouTube really doesn't have many cards to play here.
However, if this tactic proves successful, we should all expect similar moves by other content owners. Although YouTube may not be sued out of existence, the burden of sharing whatever meger ad revenues with all of these content owners will definately be another nail in the coffin. I'm 100% for digital music, video and text solutions that open up entertainment and education.
However, sites like YouTube have skated along far too long on nothing but the backs of its friends and VC money - without a real business model or strategy. The site ONLY took off due to copyrighted work. Prosecutions have come for teenages pirating a few songs... why not for a mega giant with thousands of infringements in full view of the world? It's a 'fun' site but adds zero value. I believe a dark cloud is coming for YouTube. 
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