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Digital Top Stories
Google and Vevo renew partnership
By Chris Cooke | Published on Wednesday 3 July 2013
Google has renewed its partnership with Vevo, making an investment in the music video platform as part of the new deal, thought to be in the region of $40 million (maybe up to $50 million) and giving the web giant something like a 7% stake in the business.
As the original deal between Google and Vevo – the digital firm owned by Universal Music, Sony Music and the Abu Dhabi Media Group – reached its conclusion there was some speculation that the music video company might look to strike up a partnership with a different web partner.
Though, in reality, a divorce never seemed all that likely because, while Vevo has been busy building its own platforms and apps to connect with web-users direct, a significant part of its user-base still access the service via the YouTube platform, many unknowingly, meaning the Google company brings audience as well as technology to the table.
Nevertheless, negotiations between the two parties were long drawn out, and no new deal was in place by the time the original agreement expired in April. Vevo, knowing that the official music content it brings to YouTube is a key part of the video site, was pushing for a better deal in terms of what cut of the ads it sells it has to share with Google.
Although the terms of the new arrangement aren’t known, YouTube has confirmed in a statement: “We made an investment in Vevo. We are excited by their future prospects and to provide YouTube users with the best possible music experience”.
Vevo will use the Google money to fuel further international expansion and the creation of original content. The music video company is known to have sounded out other possible investors in recent months, and speculation of an all out sale by its current owners to someone like Guggenheim Partners continues.
It’s not clear what the Google deal, and shareholding, says about those other activities, though talks with possible other investors or buyers were likely hindered slightly by the insecurities caused by the YouTube partnership being in limbo. Meaning further developments in those areas could now be likely.
