The music industry's patience with Muziic and the site's teenage founder may have finally run out.
Rio Caraeff, chief executive of Vevo, the recently launched Web site that features music videos from three of the top four recording companies, wants 16-year-old David Nelson to stop using the service's content and trademark. Caraeff e-mailed Nelson on Tuesday asking him to comply.
Nelson is the precocious high school coder who launched a music service last March that enables users to treat YouTube music videos in much the same way that song files are handled at iTunes. The videos can be sorted and added to playlists and perhaps more importantly, a user can listen to the music without having to watch ads.
I had anticipated the teen would get an adult-size smackdown much earlier than this. The major record companies have stood by and done nothing as Nelson used their content--with the help of YouTube's API--to build a site, a following, and now a burgeoning business. This is no high school science experiment. Nelson has begun selling ads and generating revenue, and the music labels have long signaled that they won't allow someone to profit from their material without getting compensated.
Nelson might be the first prep schooler to do this, but certainly we've seen oodles of sites try to use unlicensed music in a similar way, and how many of them have been sued into oblivion?
It probably isn't relevant that he's just a kid. Digital music is a high-stakes game and the grown-ups aren't playing around. Nelson was bound to run into trouble sooner or later.
What likely set off Vevo managers is that Nelson recently launched a new site and incorporated Vevo's material, once again with the help of YouTube's API. Then, Nelson announced this week that music fans could enjoy Vevo videos at Muziic but without all the ads. Vevo offers videos free of charge and ads are its main source of revenue. On Tuesday, Caraeff sent Nelson this e-mail:
"I kindly advise you to immediately cease the use of the Vevo Logo, trademark and any other references to our corporate name," Caraeff wrote. "With regards to the use of Vevo licensed videos...they are also being used directly without our consent...You can be assured that changes are being deployed to the API in question immediately, however I am still going to ask you directly to cease the use of Vevo videos from within your service."
Vevo executives confirmed that preparations are being made to make Vevo's content inaccessible through YouTube's API.
But Nelson has no intention of backing down.
He says he will stop using Vevo's trademark if that's what they want. But when it comes to the videos, he says he has adhered to all of the requirements of YouTube's API.
Nelson thinks that Caraeff may have the wrong idea about him. He says he's a friend to the music industry and to artists. He said that it's been wrongly reported that Muziic strips out the ads that accompany YouTube and Vevo videos. He says ads have not been delivered to Vevo videos yet via the YouTube API. That's not his fault, he says.
"We have not taken any actions to circumvent the delivery of 'pre-roll' advertisements," Nelson said in an e-mail. "The syndication of advertisements through the YouTube API is beyond our control."
It's going to be interesting to see what occurs here over the next couple of weeks. Most likely, Vevo will remove content from YouTube's APIs and the issue will be behind us. But what happens if Nelson irritated somebody at the labels? When you talk about companies that have run afoul of the music industry, they are typically venture-backed and employ lawyers and staff and own office space and coffee machines.
In Muziic's shoestring operation, you have David and his dad, Mark, working out of their home in Bettendorf, Iowa--population 32,445.
Call me a handwringer but maybe Nelson should avoid confrontation and look to cut a deal. His service is impressive regardless of his age and maybe he and the music industry can find common ground.