Fresh from the news that Warner Music and YouTube are no longer playing nicely together comes new rumors that the music industry cartel are talking about creating a Hulu for music videos.
According to a source quoted at Silicon Alley Insider, Sony BMG, EMI, and Universal Music Group all think they could do better creating their own music video Web destinations and are in early talks about forming a joint venture similar in concept to Hulu.
It would be easy to label the joint venture a joke before it starts, but Hulu did prove one thing: even previously clueless media companies can occasionally get it right. Having said that though, the obvious question is where is the money coming from? The vast majority (actually pretty much all) of the revenue made by music companies on YouTube came from royalty payments from licensing deals with YouTube itself, with peanuts coming from advertising served against the videos. Unlike content on Hulu, music videos are short play, and while users might happily sit through a 30 second pre-roll (or longer: Hulu allows users to opt for longer pre-rolls for no ads during the show) for a 30 or 60 minute show, users won’t be too happy about sitting through a 30 second commercial to play a 2 or 3 minute music video.
There’s then the question of audience: YouTube’s licensing deals extended to songs played over user generated content, where as this service would presumably focus on music video alone, and while there would undoubtedly be demand for such clips, it wouldn’t be anywhere close to the demand for television shows by comparison. Scale is the key, and I can’t help but think that this venture, cut off from mainstream services would struggle to find it.
