About a year ago Universal Music Group and Google announced a new music site and YouTube channel called Vevo. Panned by Techcrunch for it’s unsocialness, more than one year later I have to admit I rather like it. Other labels have joined Vevo and there are now quite a lot of “official” music videos shared on YouTube. These clips are mostly in very high sound quality and often available in HD.
So what happened? Did the entire recording industry go bankrupt overnight?
After a year, three of the top 10 most viewed videos of all time are Vevo videos and 3 others were posted by other record labels. What a surprise! It turns out that people prefer sharp, acoustically great videos to blurry, scratch taped-of-the-TV masterpieces.
What do the labels get? Um, money. Lady Gaga, the most viewed artist on YouTube (as the first true beneficiary of Vevo) also enjoys record-breaking album sales: her first album sold over ten million copies worldwide and her second over 1.133 million copies in the United States and over a million in Europe. Lady Gaga’s videos also include product placements so that the Virgin mobile phone you saw in the Telephone clip wasn’t there by accident.
Interesting to note that number 9 on the list is a non-official version of a Jeff Dunham skit, but he does reference the official Dunham site. Jeff Dunham has also parlayed his YouTube views and recognition into a successful career. As of March 2009, he has sold over four million DVDs and an additional 7 million dollars in merchandise sales. He earned approximately $30 million between June 2008 to June 2009.
Bottom line, free content can drive profitable ventures. Let’s hope more companies learn to use YouTube and other video sites smartly.