News: NYT’s writers Andrew Sorkin and Jeff Leeds have detailed more information about the 3 majors deals YouTube struck with the recording studios Universal, Sony BMG, and Warner Music on the same day as the Google deal. In exchange for allowing their music to be used by YouTube users, the recording studios each received a small stake in YouTube. According to the NYT reporters, “Indeed, people involved in the discussions said that the music companies rushed to complete the deal ahead of the YouTube deal, in part so that it could benefit in the jump in YouTube’s value.”
Analysis: I don’t want to sound like a broken record (pun intended), but Mark Cuban’s prediction that YouTube will suffer the same copyright demise as Napster has proven to be wrong, again and again. When 3 of the 4 major recording studios have bought a stake in YouTube, that’s a powerful sign of how those music copyright holders view the legitimate business potential of YouTube.
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