Original URL: http://www.theregister.co.uk/2006/09/15/umg_sue_you_tube/

Universal to upload lawsuits to YouTube, MySpace?

Royalties, please

By Andrew Orlowski

Posted in Media, 15th September 2006 15:32 GMT

The chief of the world's biggest record label, Universal Music Group, has hinted that the company will sue the video sharing site YouTube for copyright infringement.

"We believe these new businesses are copyright infringers and owe us tens of millions of dollars," UMG boss Doug Morris told a conference this week. "How we deal with these companies will be revealed shortly."

It's no secret that YouTube has been a runaway success because it's a treasure trove of copyrighted material - effectively the internet's Oldies channel.

UMG is also negotiating with News Corporation, owners of MySpace, for a cut of performance royalties on the site. MySpace vehemently denies it should pay these royalties, although its European VP justified its refusal recently on the grounds that MySpace users "... are interacting with music in the same way as they would in everyday life - in a store or on the radio".

A bit of an oops, that, as stores and radio stations need to pay public performance royalties in most parts of the world. (Radio stations in the US are an exception).

Analysts peg the UMG chief's comments as a negotiating tactic.

It's doubtful, however, whether UMG will take a one-size-fits-all legal approach to infringement. MySpace is owned by one of the world's biggest media multinationals News Corporation, and snagged almost a billion dollars from Google recently for a three-year advertising contract. However the independent start-up YouTube is more likely to plead poverty: it has only just started to scratch around for revenues to offset its astronomical operating costs. Despite the claims made by the utopian lobby, most of the traffic at YouTube is people looking for copyright material. Or people looking at other people lip-syncing to copyright material.

Not that pleading zero revenues has ever stopped UMG suing someone out of business before. Just ask Michael Robertson. ®