NEW YORK (AdAge.com) -- After talks to renew a licensing deal failed, Warner Music Group pulled its songs from YouTube in what could be an opening salvo in a battle between the music business and the world's largest video site.
Warner Music was the first major label to ink a deal with YouTube shortly before Google acquired the video site in 2006. The pact paid the label a minimum fee or a percentage of the ad revenue generated by videos uploaded to the site.
That deal expired months ago, a Warner spokesman told The New York Times. Universal Music Group, SonyBMG and EMI also have licensing deals with YouTube. Universal and SonyBMG are in talks to renew their deals, which expire in the next few months, according to The Wall Street Journal. After weeks of failed talks, Google notified users of the impasse and started blocking access to videos from Warner artists over the weekend.
"Despite our constant efforts, it isn't always possible to maintain these innovative agreements," YouTube said in a blog entry. "Sometimes, if we can't reach acceptable business terms, we must part ways with successful partners."
Music videos account for the biggest percentage of viewing on YouTube. Forty-seven of the top 100 most-watched creators on YouTube are musicians or labels; to date, Warner musicians have generated more than a trillion views, according to web video services firm TubeMogul. Warner accounts for 21% of the recorded music market in the U.S.
"We are working actively to find a resolution with YouTube that would enable the return of our artists' content to the site," Warner said, in a statement. "Until then, we simply cannot accept terms that fail to appropriately and fairly compensate recording artists, songwriters, labels and publishers for the value they provide."
The Warner dispute could be the first of many as the labels renegotiate deals struck back in YouTube's infancy. Since then, the video service has grown into the largest video site, accounting for nearly 40% of all video views in the U.S., the second-largest search engine, and the fourth-largest website in the world.