YouTube, Warner Music to Share Ad Revenue

YouTube, the uber-popular online video sharing site, has teamed up with Warner Music Group in a pact that will see revenue derived from site ads placed next to Warner’s content—or user-generated content that features Warner music or video—shared between the two the firms, The Wall Street Journal reports.

YouTube and Warner plan to begin sharing ad revenue before the start of 2007, but Chad Hurley, YouTube chief executive, did not offer specific financial details of the deal, according to the Journal.

The agreement represents a move on YouTube’s part to address the various copyright issues it and other video-sharing sites face due to the fact that their users often post materials without the proper approval of copyright owners.  YouTube currently removes all copyrighted material if the official owner requests the content be taken down.

YouTube is already working on an automated system that will enable it to determine whether copyrighted material is used in video clips submitted by users, and it plans to use the system to compensate Warner’s copyright owners for the use of their content—assuming the owner has an agreement with the site and hasn’t requested that the material be removed, the Journal reports.

San Mateo, Calif.-based YouTube also plans to eventually make the upcoming system available to additional copyright owners who have content posted on the site, according to the Journal.

“Warner Music Group becomes the first media company working with us to truly embrace the power of user-generated content and allow users to use their content in legal ways, and be able to benefit by generating revenue,” Hurley said, the Journal reports.

Hurley also said that in the future, the site may extend the revenue-sharing system to amateurs who submit their content for use on YouTube, according to the Journal.

Just last week, Universal Music Group’s chief executive called out YouTube, claiming the video-sharing site violated copyright regulations by hosting content on its site that was uploaded without the proper approval of its owners, the Journal reports.

In related news, YouTube last month said it would display video advertisements on its site.

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