By Raphael G. Satter
LONDON (AP) --Google Inc. said Monday it will block U.K. users from watching music videos on its popular video-sharing site YouTube after negotiations with Britain’s music royalty-collecting body broke down.
Google said it would begin blocking British users starting Monday night. The Internet titan said it knew the move would cause “significant disappointment.”
But it said its hand was forced by PRS for Music, which it said is asking for royalties that would cause Google to lose money every time a video was played on YouTube.
“Our previous license from PRS for Music has expired, and we’ve been unable so far to come to an agreement to renew it on terms that are economically sustainable for us,” Google said in a statement. Until a solution is found, it added, “we will be blocking premium music videos in the UK that have been supplied or claimed by record labels.”
PRS for Music, which collects money on behalf of writers and publishers worldwide, said it was outraged by Google’s move.
“Google has told us they are taking this step because they wish to pay significantly less than at present to the writers of the music on which their service relies, despite the massive increase in YouTube viewing,” the group said in a statement.
Neither group revealed how much money is at stake in their negotiations.
YouTube has become an increasingly popular destination for record labels squeezed by declining sales for compact discs. The Web site has deals with three of the four major record labels but some rights-holders have balked at their cut of the advertising revenue.
In December, Warner Music pulled all of its music from YouTube, saying the payments it received did not fairly compensate the label or its artists and songwriters.
It was not clear how long the music videos would stay blocked. Both PRS for Music and Google said they hoped their dispute could be resolved quickly.
The video Leona Lewis’s “Bleeding Love,” licensed by Sony BMG Music Entertainment U.K. Ltd., which has garnered more than 83 million hits, was still visible from the U.K. late Monday.
Google Opens Its Defense In Antitrust Case Alleging Monopoly Over Online Ad Technology
Google opened its defense against allegations that it holds an illegal monopoly on online advertising technology Friday with witness testimony saying the industry is vastly more complex and competitive than portrayed by the federal government.
"The industry has been exceptionally fluid over the last 18 years," said Scott Sheffer, a vice president for global partnerships at Google, the company's first witness at its antitrust trial in federal court in Alexandria.
The Justice Department and a coalition of states contend that Google built and maintained an illegal monopoly over the technology that facilitates the buying and selling of online ads seen by consumers.
Google counters that the government's case improperly focuses on a narrow type of online ads — essentially the rectangular ones that appear on the top and on the right-hand side of a webpage. In its opening statement, Google's lawyers said the Supreme Court has warned judges against taking action when dealing with rapidly emerging technology like what Sheffer described because of the risk of error or unintended consequences.
Google says defining the market so narrowly ignores the competition it faces from social media companies, Amazon, streaming TV providers and others who offer advertisers the means to reach online consumers.
Justice Department lawyers called witnesses to testify for two weeks before resting their case Friday afternoon, detailing the ways that automated ad exchanges conduct auctions in a matter of milliseconds to determine which ads are placed in front of which consumers and how much they cost.
The department contends the auctions are finessed in subtle ways that benefit Google to the exclusion of would-be competitors and in ways that prevent... Read More