• Billboard, Tuesday, January 2, 2007 11 AM

As the predictions for 2007 pour in, Billboard says this should be the year the music industry figures out how to profit from user-generated content.

In 2006, record labels like Universal Music Group struck deals with YouTube and Google Video, enabling video users to freely use their copyrighted material in exchange for a cut of the publishers' ad revenue. As opposed to suing all and sundry--a policy that will ultimately prove both fruitless and futile--these progressive deals represent an important part of the recording industry's future.

The music industry has to figure out how to roll with the times. The proliferation of piracy and online video show just how far their backs are against the wall. File sharing and user-generated content aren't going away, so they need to figure out how to turn the movement in their favor.

Technology will sort out the rights mess that weighs down the business, but in the foreseeable future, there's no question that advertising will become a bigger part of the music industry.

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