YouTube in music label talks

By Simon Aughton

Posted on 16 Aug 2006 at 13:02

YouTube has begun talks with record labels in the hope of beginning to offer music videos alongside the home videos, viral ads and bootlegged clips that have propelled it to the top of the Internet popularity ratings.

The site's founders are currently working to develop a commercial model that will allow it to provide the videos for free, in all likelihood supported by advertising currently conspicuously absent from the site.

'What we really want to do is in six to 12 months, maybe 18 months, to have every music video ever created up on YouTube,' co-founder Steve Chen told Reuters. 'We're trying to bring in as much of this content as we can on to the site.'

Chen wants to videos to be an extension of the community nature of the site, which claims to serve 60 per cent of all videos viewed on the Web. Users will be able to add videos to their own profiles and post reviews.

YouTube's ability to deliver all those videos, with the corresponding cost of all the bandwidth required, remains a mystery, since it has no discernible source of income. Its popularity makes it ripe for a lucrative takeover, but even if it can settle on a viable commercial model potential suitors are likely to be wary, given the amount of copyright material that the site hosts. An agreement with record labels would at least legitimise some of that content.

News of the record company talks emerged as the website suffered its first unplanned outage, going offline for six hours yesterday which YouTube attributed to a database problem.