The Copyright-ization of YouTube

For anyone dreaming of a YouTube IPO (or M&A), hope comes in the form of a licensing deal with Warner Brother Music that will see some kind of revenue sharing. According to AP, Warner will license thousands of music videos to YouTube. Warner will also let people use its songs in home-made video that appear on YouTube. There a few of ways to look at the deal. Either it's the legitimization of YouTube as copyright owners start to embrace the popular video-sharing service – something envisioned by TechCrunch. Or it's the end of YouTube as we currently know it as a flurry of copyright owners begin to demand their own copyright deals – a scenario envisioned by Mark Cuban in a post called “The Coming Dramatic Decline of Youtube”. A third way (and perhaps the middle ground between TechCrunch and Mark Cuban) to consider how the YouTube-Warner arrangement could impact the entire video-sharing “industry”. As Mark Cuban notes, video-sharing sites have thrived due to free hosting and the ability to infringe copyright without any fear of retribution (a whole bunch of venture capital certainly helps too!). But what happens if/when the video-sharing industry is copyright-ized? What happens if content owners start demanding a cut of the action if, as expected, video-sharing evolves into a business from a pop-culture phenomena? At that point, some of the strong players will likely abe able to survive because they have the financial ability and popularity (a.k.a. potential content customers) to cut deals. The others, I'm afraid, could disappear because content owners may not find it viable to hammer out licensing agreements.