Warner Music Group and YouTube have failed to negotiate the subject of renewing the licensing agreement for the record label's music videos. The discussions broke down Friday and, early Saturday, the third largest record label removed videos from the Google-owned video site. It's interesting to see that this comes in a time when all four major labels, including Universal Music Group, Sony Music and EMI are renegotiating their licensing deals with YouTube. Warner said in a statement that they just can't accept terms that fail to appropriately and fairly compensate songwriters, labels, recording artists and publishers for the value they provide.

 

However, YouTube really seems to have brought important revenue to at least one of the top labels, as Universal Music said that the site has generated tens of millions of dollars for the recording company this year, up 80 percent from last year. It looks like Universal will likely book nearly $100 million in video-streaming revenue, most of it from YouTube. Unfortunately for Google, even if the label companies are starting to make money, the video site doesn't, as YouTube has to pay labels each time someone views a clip, regardless of whether it's generating any revenue.

 

It's hard to say if YouTube or Warner will regret this. Google's site is the Web's No. 1 video site, which topped 100 million visitors in October. Of the top 10 YouTube channels, 7 are music related, while Warner Bros. Records is the 11^th largest channel. However, by ending the agreement, YouTube will remove (if it hasn't already) all videos of top artists, such as Led Zeppelin, Madonna, TI, Eric Clapton, REM, Red Hot Chili Peppers and the Grateful Dead.