Will You … Vevo?

How important is Vevo? If you want to go by press coverage, Vevo got a major boost in public image May 15 when the Wall Street Journal devoted a huge chunk of space to the yet-to-launch video site described as an effort to “present music videos in a controlled setting.”

In other words, the label is creating a site where operators, not users, determine the video inventory. One of the problems encountered by Google-owned YouTube is that potential advertisers are leery of user-contributed content.

Sure, that may be a Green Day music video on YouTube, uploaded by someone called Number1GDFAN, but there’s no guarantee that 2 minutes into video the scene won’t flip to some guy showing off his homemade flame thrower. Like Forrest Gump’s often-quoted remark about a box of chocolates, sometimes you never know what you’ll get on YouTube.

In fact, Universal is working with Google to develop Vevo with the expectation that the new site’s “controlled setting” environment will allow the label to charge higher ad rates than the current YouTube norm. Kind of like Hulu, but no TV shows and no movies. Just music.

Of all the major labels, Universal has been one of the more aggressive record companies when it comes to online strategy. The company, along with Sony-BMG, is partly responsible for Nokia’s “Comes With Music” promotion where buyers of certain Nokia cell phones get almost unlimited downloads for a specified time period after the purchase.

During the late ‘90s Universal was also the home of Jimmy and Doug’s Farm Club, a Web effort promoting a kind of pre-American Idol talent competition where the winner received a recording contract. Shortly before its demise, Farm Club morphed into a somewhat experimental music-streaming service utilizing UMG recordings. That is, until complaints from music publishers forced an end to the endeavor.

Then there’s that entire episode in 2001 when Universal Music’s parent company, then known as Vivendi Universal, purchased MP3.com for $372 million, but ended up selling the assets to CNET.

In other words, Universal has had its ups and downs in Webdom, and no one is predicting Vevo’s success or failure. However, the smart money says the label must get others to follow its lead in order for the video site to succeed. Universal is only one of the four major labels and there’s no indication whether EMI, Sony-BMG and Warner Music Group will also contribute content.

“There isn’t really a precedent for a major record label building a digital service which ends up as a sort of neutral arbiter for the other labels,” Forrester Research vice president and research director Mark Mulligan told the Journal, adding that Vevo may succeed, but “the odds are against them.”

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