Is it likely that YouTube and Universal will make a website that will make music videos profitable?
Google’s (GOOG) YouTube and Universal Music Group are discussing the possibility of creating a premium online music-video service. Google acquired YouTube in 2006 for $1.65 billion. It remains a promising website, but has yet to plump Google’s bottom line. It looks like a good match: Universal Music Group gets added distribution and YouTube gets content beyond cute kittens, political commentary and frat boys in their natural habitat. * STOCKS * RELATED ARTICLES * ALSO BY… SEARCH: Is Microsoft’s Messenger TV Next YouTube? Quick Hits: YouTube, Viacom Get Ready To Rumble Two Ways To Play: Google Searching For YouTube Ads Even Google Can’t Squeeze Profit From YouTube Quick Hits: Olympics In The Palm Of Your Hand Wal-Mart Joins the Bonus Ball After-the-Fact AIG Tax: Un-American? Deal or No Deal: Microsoft Still Eyeing Yahoo Online Sellers Unable to Keep Taxes at eBay MySpace Battens Down the Hatches The deal could move YouTube into the fellowship of money-grubbing big media. In the past,
Right now it’s just a rumor, but if they do join forces they could be quite formidable. Google has the clout, Universal has the intellectual property. It could be a win win for the companies. … Reuters reports that YouTube would create a standalone website featuring Universal’s performers to compete with News Corp.’s (NWS) Hulu.com. YouTube and its mix of user-generated and professional videos is the top video website in the US with about 100 million viewers in January. Hulu grabbed 24.4 million viewers in January. Lining up Universal Music Group would provide the foundation, but to succeed, the offerings almost certainly would have to include other major labels such as Sony Music (SNE), EMI Group and Warner Music Group (WMG). Sources: http://news.moneycentral.msn.com/ticker/article.aspx?
