Google and Sony Music have extended their agreement that will keep Sony artists’ music videos and music on YouTube. The deal is final but hasn’t yet been announced, MediaMemo’s Peter Kafka reports.
Kafka: It’s unclear what the final deal terms are, but people familiar with the matter tell me that the negotiations revolved around three components: an upfront payment from YouTube to Sony, the minimum amount Sony will receive each time someone plays a Sony video on the site, and the way the two sides will split revenue generated by any of the label’s videos.
This means YouTube will keep videos featuring Beyonce, Britney Spears, Bruce Springsteen, and other Sony Music artists. Warner Music artists are still off the site as the two companies work on a deal.
Music videos are some of YouTube’s most popular offerings, but they have also been expensive for the video site. Under the terms of its old deals with the labels, YouTube agreed to pay the music companies either a per-stream fee or a share of ad revenue associated with the clip, whichever is greater. Since YouTube is just beginning to get serious about selling ads next to its content, it’s usually paying the per-stream fee, which industry executives peg at about half a penny per clip.
We wonder if Sony will eventually try selling music videos on YouTube via the company’s new download service. Sony sells music videos on Apple’s (AAPL) iTunes store for $1.99.