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Digital
VEVO boss says no IPO on the agenda
By CMU Editorial | Published on Thursday 22 December 2011
VEVO chief Rio Caraeff has denied his company’s owners, Universal Music, Sony Music and the Abu Dhabi Media Company, are planning to float the firm in 2012. Though the fact that both he and founder Doug Morris have popped up in the Financial Times talking up their music video business might suggest that at least some thought is being given to impressing City types, just in case an IPO does suddenly become an option down the line.
As previously reported, The New York Post reported rumours last month that the video site, owned by the two majors and powered, and in part promoted, by YouTube, would be spun off as a stand alone company via an IPO.
Recent interest in City circles in digital companies could make such an IPO lucrative for Sony and Universal, both of which could do with some extra cash to fund their respective EMI acquisitions (though, technically speaking, Sony Music owns a slice of VEVO while Sony/ATV is buying EMI Music Publishing). And with plans to further expand the VEVO service, possibly into its own TV channel, Universal’s co-ownership of the prominent video site in particular is likely to raised when competition regulators review its EMI acquisition plans.
But in the FT interview, Caraeff insists VEVO is not for sale, adding he has “no interest personally in running a public company”. Morris, who created VEVO while running Universal, though remains a key stakeholder in his new job heading up Sony Music, is slightly less dismissive of the IPO proposals, though does stress “it would be important for record companies to maintain some control”.
The FT article, which refers to Morris as “the man who made music videos pay”, tells the VEVO story as well as dropping in some stats provided by the video site, who claim to have 600 advertisers and to have paid out $100 million in royalties to the labels whose music it carries, which includes its owners and EMI. Of course a lot of VEVO’s traffic comes from YouTube users who inadvertently land on the video site, though I suppose that’s not really a criticism but testament to Morris’s decision to collaborate rather than compete with the Google service when he set up his big music video website.
Read the FT piece here.
