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Universal signs deal with music publishers group for Vevo, YouTube royalties

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The US National Music Publishers Association has signed a deal with Universal Music Group that gives publishers a cut of advertising revenue when music videos are streamed on YouTube or Vevo.

vevo screenshot
vevo screenshot

The US National Music Publishers Association has signed its first royalties deal with a major label over music videos streamed on Vevo and YouTube. Unlike cover songs or background music, which are covered by an existing agreement, music videos have long been seen as promotional tools. That means labels traditionally don't pay royalties when using the song. The NMPA's new agreement with Universal Music Group, however, will let publishers collect some of the money Universal makes by placing ads alongside its videos.

Sources say the deal, which is retroactive back to 2008, would give publishers 15 percent of advertising revenue from videos, or 10 percent for revenue earned in 2008 and 2009. Besides music videos, it would also reportedly cover concert footage, backstage videos, and artist interviews. NMPA CEO David Israelite says the group will now be turning its attention to making deals with other labels, calling the agreement with Universal "an important first step in resolving industry-wide music video issues."

The agreement was announced a week after Israelite called attention to what he saw as a growing gap in music profits. "Today you have VEVO talking about reaching $150 million in revenue and wanting to grow to $1 billion," he said at the NMPA's annual meeting last week, "and a large amount of the music videos being played are not getting licensed and publishers are not being paid." As the streaming industry grows, negotiations over this new model are likely to get ever more heated.