Universal Music likely to sue YouTube, MySpace

TALKS between Universal Music and the owners of YouTube and MySpace over 'copyright issues' are on the verge of breaking down.

Universal Music CEO Doug Morris recently dubbed YouTube and MySpace 'copyright infringers' that owe the outfit tens of millions of US dollars.

He said that "how we deal with these companies will be revealed shortly" - in other words the lawyers are writing the letters right now. Talks with News Corp.'s MySpace have been progressing a little better, but not much. YouTube negotiations have broken down completely.

YouTube has a policy of removing copyright-infringing material uploaded by users and has had a reasonable relationship with the music and video industry which uses it for promotion of its material. However Universal seems to have split from the other record labels in trying to squeeze money out of various websites lately. It has started charge Web portals such as Yahoo and Time Warner AOL for playing its artists' music videos online or over video-on-demand services.

Of course if it does press ahead with a court case against the popular YouTube it might backfire incredibly in its efforts to combat online software piracy. Killing off YouTube will not be the same thing as removing Napster which did not have such "across the board" support. Suing lip synching fat kids for posting themselves singing pop songs will make Universal universally hated by all their potential customers.

More at Market Watch. µ