Vevo CEO Says 'We Have no Intention to Leave YouTube'
Rio Caraeff talks to THR's sister site, Billboard.biz, about the video site's upfronts, royalties and growth.
It's a transitional time for Vevo, as the No. 1 most-watched YouTube channel (and No. 3 most-watched U.S. video platform on the web, according to Comscore) prepares to host its first upfront event for advertisers and agencies in New York on Wednesday.
But it's also a transitional time for the video site, as it looks to expand its distribution to platform beyond YouTube, such as Facebook, mobile, tablet and TV apps and its own URL, Vevo.com.
Despite all the speculation, CEO Rio Caraeff set the record straight in a panel discussion and after-panel interview with Billboard.biz at the Rethink Music Conference in Boston, presented by MIDEM and Berklee College of Music. Below are excerpts from a post-panel interview.
Billboard.biz: So this week is Vevo's first upfront. Why is it important for you to sell Vevo in the same way that TV is bought and sold every year?
Rio Caraeff: We're trying to change the way brand marketers perceive the audience. We're trying to package and present the audience that loves music in a new way to the world's largest global brand marketer. We're saying that the audience that loves music is vast, passionate, engaged and excited and that audience is no different than the audience that loves the Super Bowl or the premier of an episode of American Idol or Glee. We're appealing to the television media buyers, those who play in the $70 billion TV advertising industry. That's what this presentation is about this week.
BBB: Over the years, and especially in the last two years, you've been trying to bridge the gap with your ad agencies by bringing artists into ad agencies for private performances and meetings. How has that approach benefitted artists?
Caraeff: We bring artists to meet with various buying agencies around the country, whether it's in Chicago or Atlanta, New York or L.A. And what that does is it introduces these media buyers and planners to the power of music in their own territory on their own turf, also as a calling card for Vevo. It's a way to talk about our philosophy and targeting and our reach and our programming. It also leads to unexpected opportunites for these artists: Ne-Yo now has a brand marketing relationship with one of the auto brands we've met with. We've exposed artists to sync licensing opportunities and become brand spokespeople and develop their own brand as an artist. We see there's ancillary benefits that come out as well. It's really about getting Vevo in front of the agency people rather than having the agency partners come to you, which is sometimes harder.
BBB: "American Express Unstaged" is another program that's become sustainable for your artist partners because many of those concerts and events are geared toward release-week for those artists. What are some ways you see that moving the needle for those artists?
Caraeff: First of all, it's an exciting platform. It's not about just having a live concert it's about pairing a filmmaker with an artist at a specific time in a specific place. Whether it's Terry Gilliam with Arcade Fire or Spike Lee with John Legend and The Roots or Todd Haynes and My Morning Jacket, there's a visual artist's approach to the whole concept. This week it's Gary Oldman, the actor, with Jack White, which is sure to be interesting. You're gonna get an experience which you couldn't have had otherwise. And we time it so that it's release week, it's a moment in time where we're trying to create the most awareness and interest with the fans. AmEx is all about access to experiences and they understand that quality of production and good ideas take time to develop. It's not about how do you do it as quickly or cheaply as possible; it's about focusing on the quality of the execution. They're a fantastic partner who really gets it, and it's the best partner we could ask for.
BBB: We talked about YouTube and Facebook and different ways Vevo can be ubiquitous and not just limited to one platform. So, a year from now, where do you see Vevo being distributed?
Caraeff: I think a year from now you'll see the Vevo brand and the Vevo site and apps in many more countries, so there'll be another choice for people who want to get quality video experiences in other countries. It'll be led by television, but also the fastest-growing part is mobile and tablets and more global revenue. Right now the consumption is international but the revenue is domestic in terms of where the ad markets are. How do you make money in countries where you have a lot of consumption but the ad markets are less developed than the U.S. All these things you'll see us focus on over the next few years.
BBB: Will this still be with YouTube in some capacity? You're not leaving YouTube?
Careff: We have no intention to leave YouTube, no.
BBB: Vevo reports revenue figures to its label partners on a monthly basis. How is Vevo giving back to the music industry?
Caraeff: We recently announced two figures. One, that in two years being in business that we had invested over $100 million in programming or - said another way, paid out over $100 million in royalties to the music industry. We also announced in our second year in business we generated over $150 million in revenue.
BBB: Any projections to how those might evolve in 2012?
Caraeff: Not that I can be quoted on publicly. Only that we see the business continue to grow.