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Rights Issues Behind YouTube's WMG Deal

Even if you're not in the recording biz or the movie industry, you know that Hollywood is a complicated world of lawyers and licensing and distribution contracts. So it should come as no surprise that the much-hyped deal struck between viral video provider YouTube and Warner Music Group is more complicated than it might appear. The deal cleared WMG's music and music video catalog for use on YouTube, but for videos created by the YouTube community, releasing those rights is much more complicated than simply receiving WMG's blessing. WMG is able to sign off on its master rights for recordings, but for performance, YouTube will also need to obtain a license from two performing rights societies: ASCAP (American Society of Composers, Authors and Publishers) and SESAC (Society of European Stage Authors and Composers). YouTube confirmed that it's speaking with both organizations, but neither one would comment. Until the SESAC and ASCAP are on board, Reuters says YouTube will not have the right to stream roughly half of WMG's songs. Synchronization rights, which refers to the right to synchronize a recorded composition with a visual image, also need to be cleared with music publishers before YouTube users can legally lip-synch to copyrighted music. WMG is a recorded music company, and Warner/Chappell Music is its publishing unit, which may control some but not all of WMG's artists' publishing rights. For the YouTube/WMG deal to work, the label will have to set a standardized rate for digital synch rights that all of its publishers agree to. That could--and should--take a while. "As a result," says Reuters, "WMG may find itself having to pull from YouTube many user-generated videos featuring its songs, while the major label group negotiates with independent publishers and other publishing houses, some controlled by rival major labels--something WMG sources say the company is prepared to do."

Read the whole story at Reuters via Billboard »

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