Groundhog Day?

Mark Mulligan | September 18, 2006, 08:00 AM

If the European anti-competition authorities ever want evidence that the major record labels are not one homogeneous monopolistic group then here it is: hot on the heels of a Universal Music Chief stating that YouTube should face legal action for copyright infringement comes the announcement that Warner Music Group have signed a music video deal with the video service.

What’s key to this is that the deal is not just a straight licensing deal but also enables YouTube users to legally incorporate videos and music into their own uploaded videos.

So you have the two strategic alternatives:

1 – Recognize new consumption patterns and build licensing structures to try to embrace and monetize the activity (WMG)
2 – Try to crush it because it doesn’t fit in with the established models (UMG)

Given a choice I know which option I’d go for.

Surely the lessons of Napster and Kazaa have been learnt? Or is this going to be a Groundhog day?