Hulu, the site that offers free streaming TV shows and movies, is trying to strike deals with major labels Universal, EMI, Sony and Warner to host music videos. The dealings indicate that Hulu is planning to compete directly with YouTube-backed music video site Vevo.com, which is expected to launch later this year.

YouTube has already teamed up with Universal Music Group (UMG) for Vevo, but is also interested in negotiating the addition of the remaining labels to the new video site. Ironically, if all goes as planned, Hulu and Vevo will both stream the exact same music videos licensed from the same labels. They will undoubtedly be contending with each other for our attention in the near future, but if they are offering the same content, how will we choose between the two?

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Amateur videos on featuring copyrighted songs on YouTube are being muted or removed, due to a failed deal between the video site and Warner Music Group. The disagreement revolves around the fees paid to Warner for the use of its music videos. Since YouTube uses an automatic process to find unlicensed material on its site, videos of amateurs covering songs and using copyrighted background music are targeted. Will Tanous, a spokesman for Warner Music, defends the company’s position:

“We and our artists share the user community’s frustration when content is unavailable. YouTube generates revenues from content posted by fans, which typically requires licenses from rights holders. Under the current process, we make YouTube aware of WMG content. Their content ID tool then takes down all unlicensed tracks, regardless of how they are used.”

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It is a fact that the music industry is in recession. In the aftermath of 2008, when miserable record sales and widespread file-sharing destroyed profits for major labels, the music industry is now scrambling for new ways to get their hands on your hard-earned cash. Competing with “free” isn’t easy, and the industry has shown it’s ready to adopt creative attitudes toward music consumers and free distribution, while simultaneously trying to implement new business models that force money into their pockets via taxes or subscriptions. It’s time to take a closer look at these schemes.

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MySpace’s music sales program launched today, but it is yet another music store that fails many customers.  The four major music companies – Sony BMG, Universal, Warner, and EMI  have partnered with MySpace to create MySpace Music, leaving out independent labels that were unwilling to accept subordinate status.  Merlin, a group representing a number of independent labels whose market share totals 9 percent, wants a stake in MySpace music, not just the advertising revenue MySpace and the four majors, which all have stakes proportional to their own market shares, are offering. 

So a bunch of artists are again left out of a big online music store.  The major labels never seem to learn that they can’t control the music industry the way they used to and rule over all of the little labels.  But as this week shows, corporate America is not especially longsighted.

Source: Reuters