Vevo is a multinational video hosting service that is most well-known for uploading music videos on YouTube.
The company has also produced content for distribution across various online platforms and hardware devices such as smart televisions.
The service was founded in 2009 as a joint venture between two record companies: Sony Music Entertainment, Universal Music Group, and EMI.
Initially, Vevo entered into an ad-revenue share agreement with Google where music videos would be hosted on YouTube.
Vevo’s own website was launched simultaneously, featuring around 30,000 videos from some of the world’s most popular music artists.
In May 2018, Vevo announced that it would focus on YouTube syndication and shut down its website and app.
Considering the company’s website saw 25 billion views per month and featured over 330,000 videos, many saw this as a somewhat perplexing decision.
World domination and complacency
Vevo had dreams to become a world-dominating company early in its existence.
For one, it had an immensely popular website and companion app.
Vevo also owned most, if not all, of the world’s most famous music artists and their music.
The company had unbridled power to sell merchandise, control advertisers, and even add its brand name to the names of individual artists’ YouTube channels.
Over time, this power caused complacency within the company.
With its sleek website and advertising revenue that it did not have to share with YouTube, Vevo believed the agreement with the video platform was unnecessary.
The ramifications for Vevo’s plans did not go unnoticed in the industry. Parting ways with YouTube would mean that almost every music video would have to be pulled from the site save for indie tracks.
Many were also fearful that with every music video found in only one place, Vevo would implement a subscription model and charge consumers for music videos that had always been free.
Website and applications shutdown
In May 2018, YouTube announced the new streaming service YouTube Music which would feature a mobile app created to play music, including live versions, covers, remixes, and rare tracks.
This placed extra pressure on Vevo, which was already unable to compete with YouTube’s market dominance and a new player called Spotify.
With most of Vevo’s ad revenue sent to record producers and YouTube and the company unable to raise capital from its majority owners, Vevo decided to shut down its website and apps three days later.
The company then decided to focus on advertising on its distribution platforms and sponsoring video premieres.
Primarily, this involved a renewed focus on YouTube and a new partnership.
Perhaps sensing it would never become a powerful, standalone entity, Vevo entered into a new agreement with YouTube where the video site would sell Vevo’s music clips directly to advertisers.
Before the deal was struck, Vevo and its sales team had first access to this revenue source, with Google earning what it could from automated ads.
While the merit of the deal was debated for some time, it was noted that Google’s team of over 15,000 sellers would generate more ad revenue for both companies irrespective of which made the sale.
What’s more, Vevo videos would become part of YouTube’s “Google Preferred” tier which houses the platform’s most valuable, brand-safe content.
YouTube chief business officer Robert Kyncl noted that “the availability of Vevo in Google Preferred enables UMG, Sony, and Vevo to participate in YouTube’s premium inventory sold to advertisers. It also increases the sales force deployed against music videos and maximizes revenue for artists and songwriters.”
Today, the Vevo website remains, and content can be watched on many devices and networks, including Apple TV, Comcast, Fetch, Foxtel, Roku, Fire TV, Virgin Media, and T-Mobile.
- Vevo is a multinational video hosting service that is most well-known for uploading music videos on YouTube. The service was founded in 2009 as a joint-venture between Sony Music Entertainment, Universal Music Group, and EMI.
- Vevo wanted to become a dominant company in the music industry but ultimately underestimated the size, power, and influence of YouTube. Many feared the company would pull its music from YouTube and charge consumers a subscription fee to access the content on its own website.
- Receiving a relatively small percentage of ad revenue and unable to raise the capital to expand, Vevo perhaps reluctantly entered into a new agreement with YouTube to become one of its preferred brands.