Google reportedly in talks to invest US$50m in music video service Vevo

6 Feb 2013

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Google’s YouTube is reportedly in talks with Vevo to negotiate a US$50m equity investment in the music video service.

According to a report on Bloomberg, the news site gleaned this information on the apparent talks between Vevo and Google from two people who had knowledge of the situation.

It’s reported that, if the deal were to go ahead, Google would own less than 10pc of Vevo in a move that would give Vevo a valuation of at least US$500m.

The Bloomberg article said that the deal would be part of a "broader contract" to keep Vevo’s music videos on YouTube.

Launched in 2009, Vevo is a joint venture between Universal Music Group, Sony Music and Abu Dhabi Media Co. The service shows videos from artists signed to labels owned by Sony Music and Universal Music. Videos are streamed via Vevo.com and mobile apps, while Vevo licenses content to MTV.com and YouTube.

As part of a contract with Google that was due to expire at the end of 2012, videos from Vevo were hosted on YouTube in exchange for one-third of the advertising revenue.

Recent ComScore analysis pointed to how Vevo was YouTube’s biggest partner channel in the UK in November 2012, attracting 11.8m unique viewers to the Vevo channel on YouTube during that month.

While Vevo has declined to comment on whether it is in talks with Google, Chris Dale, a spokesperson with Google, had this to say: "While we don’t comment on individual negotiations, we always hope to renew our relationships with valuable partners so we can continue to provide YouTube users with the best possible music experience."

Carmel was a long-time reporter with Siliconrepublic.com

editorial@siliconrepublic.com