Cingular Invades YouTube With Underground Contest

Promotion to Find Best Unsigned Bands Also on ABC

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NEW YORK (AdAge.com) -- In what is perhaps YouTube's biggest sponsorship deal to date, Cingular Wireless has agreed to back a search for the site's most talented unsigned bands. The promotion strikes at the core of rival MySpace, which was founded on the premise of exposing unsigned artists to large audiences online.
As YouTube continues to dominate the budding video-sharing space, the company has emphasized sustainable ad models and licensing deals with music companies and TV networks.
As YouTube continues to dominate the budding video-sharing space, the company has emphasized sustainable ad models and licensing deals with music companies and TV networks.

Walt Disney Co.'s ABC has been enlisted to feature the finalists on "Good Morning America" in November, potentially exposing YouTube to new audiences. ABC and YouTube struck up a relationship six weeks ago, when "Good Morning America" began airing weekly segments featuring popular YouTube videos and reactions from "GMA" hosts Diane Sawyer and Robin Roberts. There are no plans for Cingular to advertise during the November airing.

YouTube will also launch a monthly newsletter for its music community, "News from the Underground," which will showcase up-and-coming artists, new music videos and music news.

Fiercely protective users
But YouTube faces the same obstacles social-networking site MySpace does as it introduces marketing to its site, which has a fiercely protective group of users. One early comment from user JOBddt posted under the video promoting Cingular's contest read: "Get this s**t off my YouTube." What followed was a rather spirited debate among users as to whether it was good or bad for YouTube to allow marketers onto the site. One user, etherlord300, wrote in the comments section: "It was bound to happen. The big companies are starting to see the potential. Hope they don't screw it up." Still, many users left enthusiastic comments about the promotion, often just one word such as "awesome," "sweet" or "cool."

YouTube drew 34 million unique visitors in August, up dramatically from 3.5 million at the start of the year, according to ComScore Media Metrix.

As YouTube continues to dominate the budding video-sharing space, the company has emphasized sustainable ad models and licensing deals with music companies and TV networks to avoid legal issues.

Earlier this week, YouTube announced a revenue-sharing deal with Warner Music Group, which will now distribute and license its copyrighted content through the hugely popular video-sharing site.

Share of ad revenue
Warner Music can now expect an undisclosed share of ad revenue whenever YouTube users stream a video containing the company's intellectual property. If, for example, an amateur auteur borrows a snippet of Madonna's latest video or scores a short with a track from Missy Elliot's new album, Warner is guaranteed compensation. To make this possible, YouTube developed a royalty-tracking system that detects when homemade videos are using copyrighted material.

Warner is not to first record label to experiment with YouTube; Capitol Records recently posted videos by the Vines, Cherish and OK Go on the site. NBC agreed in June to promote its fall lineup on its own YouTube channel.

YouTube unveiled a new ad strategy in late August called participatory video ads, which allow members of the video-sharing community to rate ads, comment on them and list them as their favorites. The ads can also be shared and embedded into user's own video creations. Warner Bros. Records, Weinstein Co. and Fox Broadcasting Co. were the first sponsors to sign on.
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