As Google (News - Alert) begins to challenge Spotify for the spotlight with its new plan to start a subscription music-streaming service along with YouTube, a new competitor has entered the competition: Vevo LLC, a provider of music videos for YouTube (News - Alert).
Vevo’s plans to start a 24-hour music network will start online, and then expand into a subscription-based TV option later this year. It will also be aligning with a digital music trend that has taken over the industry and has begun developing its own method to create revenue.
YouTube is part of the Google Inc. entity, which essentially makes these three competition companies related in some shape or form. Although Google Play will be utilizing the YouTube video platform in its new music streaming service, YouTube will be launching its own separate subscription-music service this year along with Vevo. Commercials will also be shown on Vevo TV that will be customized for viewers based on their interests.
These new music-streaming services – while initially designed to increase viewership for each individual company –also show just how much the music industry is transforming, along with its marketing techniques.
According to Fortune, even major record labels such as Warner Music Group have reaped the benefits of music streaming services, where the company received about 25 percent of its revenue. As this digital revolution begins to explode, both the music and television industry are creating new ways in which they can profit – and with good reason.
Today, MTC collects 41 cents per month for every subscriber to its pay-TV systems, while VHI collects 19 cents am month; Vevo hopes to join this pay-TV service with its new music video platform.
It was only a decade ago that music lovers watched television religiously – especially channels like MTV – to find the latest video from their favorite artist.
The music video industry has undoubtedly been moving into the digital space, and now with platforms like Vevo, it seems the TV sector will be undergoing some major changes, as well. As top players in the field compete for ways to make the most revenue, users are going to begin to see a change in their once favorite free websites as apps begin to come with new costs.
Edited by Allison Boccamazzo