A recent report from AllThingsD claimed YouTube plans to invest in music video-sharing website Vevo for a content partnership:
YouTube and its owner Google have agreed to buy a minority stake in Vevo, according to people familiar with the deal, which hasn’t been finalized.
If it happens, it will be the second time in the last year that Google has invested directly in a video company that relies on YouTube for distribution. In May, Google put money into Machinima, the Web video network aimed at gamers.
YouTube helped launch Vevo in 2009. It offers music videos from Universal Music Group, Sony Music Entertainment, and EMI Music and features the most extensive catalog of premium music content on the Internet. Vevo’s music videos subsequently appear on YouTube, with Google and Vevo sharing advertising revenue.
The new deal between the companies will reportedly cost more than Google’s $35 million investment in Machinima and would continue to add Vevo’s music videos to the world’s largest video-sharing website. Vevo would also fork over a third of its revenue to YouTube and more than 50 percent of its revenue to label partnerships.
AllThingsD warned that the companies have “signed off” on the investment and a renewed distribution agreement, but they haven’t finalized anything and the deal “could still be derailed.”
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