There’s been substantial interest in the news this week about the Stateside launch of Vevo – an online music player that is being dubbed MTV for the 2.0 generation, and perhaps rightly so. Firstly, the service has the buy-in of three of the major labels (at present, EMI, Universal and Sony), and has done so by novel means; EMI has gone down the tried and tested licensing routes, but interestingly the latter majors have gone for equity in the business. This equity approach shows a robust confidence of the service and perhaps also suggests the licensing route is perhaps going to wane in entertainment industries if major labels can instead get a share of the profits outright.
Secondly, what Vevo looks to have solved was the perhaps fundamental flaw in Google’s high value acquisition of YouTube, with many analysts and industry commentators at a loss as to where the return on investment was really coming from, given the vast majority of content on YouTube is poor quality, grainy and often filmed from another medium in the first place, such as a TV or is a skateboarding cat. Would record labels want to have their brand next to a poor quality music video – pretty much no, and YouTube continues to flatter to deceive with regards giving Google back the billions spent to acquire it. That YouTube is powering Vevo however could resolve this; Vevo will be a branded, dedicated player with high quality content that will interest advertisers much more than current video quality – its CEO has suggested phenomenally strong rates as high as $25 – $40 per 1,000 views, an incredible jump from today’s norm of $3 – $8.
What’s more, if this content really is as high quality – and in the long term potentially exclusive or streamed live – this will encourage more people to share it and thus drive traffic even further; a solution to monetising peer-to-peer sharing (in the friends sense, not the technological sense). So is Vevo the saviour of the entertainment industry? Initial reaction has been very positive and it will be interesting to see how it rolls out in the States before hitting the UK sometime next year. Fingers crossed.