In a long, somewhat humanizing interview with Doug Morris, the UMG Chairman/CEO dismisses the promotional value of YouTube (and, apparently, everything else):
We don’t look at anything as promotion. Take a look at MTV. It turned out to be a disaster for us. We sold some records, but they built this huge company and we gave them our [music] for nothing, and what did we get?
Three years ago we were losing $7 million a year in the production of videos. One day I noticed that the videos were coming up on our computers . . . I said, “How much are we getting paid for this?” And the [answer was], “Nothing, they’re promotion.” And we called [Yahoo] and I said, “You’re making money off our videos and not paying us anything . . . we don’t want the promotion, we want to get paid.” And [they] said basically something like, “Over my dead body.” And we took all our videos down. As soon as our videos came down their viewership went down, because we’re about a third of all their videos. At some point we changed our video business from a deficit to a profit because we’re getting paid every time someone views one of our videos.
“We sold some records…” Oh, is that it? This, from the guy who famously said, “If you had Coca-Cola coming through the faucet in your kitchen, how much would you be willing to pay for Coca-Cola? There you go. That’s what happened to the record business.” Of course, people are more than willing to pay pay pay for the stuff that comes through the faucet in your kitchen: water, a $12 billion/year business.