Google’s YouTube is reportedly in talks over investing $50 million in the music video service Vevo LLC. There is nothing concrete about the deal yet as it is still in the negotiation phase and it might not even see the morning sun, according to a Bloomberg report. YouTube’s $50 million investment is expected to get it less than 10 percent equity stake in the company, valuing Vevo at upwards of $500 million.
Universal Music and Sony Music Entertainment formed Vevo in 2009 to stream original music video under their label to the users online. These videos have been widely seen by viewer worldwide and ensure delivery of safe content as well. YouTube’s current contract with Vevo expires in April and the investment is seen as a guarantee to ensure Vevo’s content remains on YouTube.
According to Comscore, Vevo got 51.6 million unique visitors in the US in December alone, which is something that would attract YouTube. As reported earlier, YouTube is also rumored to be working with content developers to to test whether viewers are willing to pay a subscription fee to access quality online content.