AOL Music have successfully completed their negotiations with the Universal Music Group relating to the inclusion of the record label’s music on their video-on-demand platform.
Universal Music are the first major record company to really look to turn the pop promo video into an earner in its own right. Earlier this year Universal boss Doug Morris said that websites making his company’s videos available to consumers on demand would have to pay a small fee each time a video was played.
MSN quickly came to a deal of this kind with Universal, but AOL and Yahoo, the other two major providers of music video-on-demand, weren’t so quick to comply, meaning that when the Universal imposed deadline for having a new deal in place passed both websites removed Universal acts from their video catalogues.
The AOL deal is believed to include a provision for paying a fee each time a Universal video is streamed, as well small cut of advertising revenues earned via their video platform.
With both AOL and MSN now on board other web companies are expected to comply with Universal’s new demands regarding video on demand, while the other record labels are expected to follow Universal’s lead in turning the music video, traditionally a marketing tool to aid record sales, into its own revenue stream.