Recent media reports claim that the online video portal of Google Inc, YouTube, is in talks with Vevo LLC, the renowned music service, to invest nearly 50 million US dollars. This development would result in 500 million US dollars valuation of Vevo while Google would own nearly 10 % of the company. The negotiations are at the early stage and there is also the possibility that agreement may not be reached.
Shares of Google Inc surged 0.9 % to 765.74 US dollars a share in New York yesterday. Mountain View, California based company’s stock has declined 8.3 % this year.
Last year Vevo and Google extended their existing contract to keep Vevo’s music videos on Youtube until April. Vevo was formed by Vivendi SA’s Universal Music and Sony Music Entertainment in 2009. People familiar with the matter said the current investment is part of the existing contract between both of the companies and also to strengthen the relationship.
In New York a spokesperson for Vevo, Jennifer Press declined to comment. In December Vevo was able to drew nearly 51.9 billion viewers in the United States. The company shows videos from artists signed to labels owned by Universal Music and Sony Music. Comparatively other websites of Google along with YouTube hold nearly 181.7 million viewers in the region.
On Wednesday Google Inc (NASDAQ:GOOG) won a landmark court case. The High Court of Australia ruled that day saying Google was not responsible for messages conveyed by paid adversities and had not involved in misleading behavior with sponsored links.
The ruling will be closely monitored internationally despite the fact that the judgment applies only in Australia. This step could be cited as a precedent in the event of similar cases in the evolving field of law.
With this ruling search engine can now argue that they are just information providers by third parties instead of publishers.