Giving Warner Music its due

The deal shifted Warner from trying to stop unauthorized uses of its music and videos to profiting from them. It was a sea change in thinking, one that increased the potential return on everything Warner did to attract fans and curry their enthusiasm. For example, consider the relatively new video genre that features people re-enacting or re-imagining music videos. A creation of UGC sites, the genre has become an active category on YouTube. The licensing deal turned those videos into a potential revenue stream for Warner, assuming YouTube becomes the ad-selling powerhouse it should be. In other words, it let Warner stop the Sissyphian (or Viacom-esque) effort to control the use of its content, and focus instead on signing bands that attract fans who really care about them. Bravo.

Warner was notably slower to make the leap to DRM-free permanent downloads, and on the whole was in the middle of the industry pack when it came to digital innovation. But as the record companies try to develop advertiser-supported businesses to replace their conventional (and dwindling) pay-to-own approaches, Zubillaga's deal with YouTube should remind them to keep their eye on the revenue they can gain from the use of their works, not the control they give up in permitting fans to be fans.