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YouTube has renewed its agreement with music video service Vevo and is making an estimated $50 million investment.
This investment gives Google, which owns YouTube, a 10 percent stake in the company and puts Vevo’s valuation at about $500 million.
Vevo holds the rights to music videos for most major music artists and is YouTube’s top channel partner. Its library of content attracted 50.2 million unique viewers to YouTube in May 2013. Vevo’s lucrative contract with Google to keep its content on YouTube ended in April, and the music video service hinted at making a deal with Facebook in the past. The new investment from Google will prevent Vevo from jumping to another partner.
Google has made multiple efforts to bring in content to YouTube, including its $200 million investment premium channel partners and a $35 million round of funding for video game media company Machinima. Vevo is owned by Universal Music Group, Sony Music Entertainment, and Abu Dhabi Media Group. It will use the money to expand its international presence and create original music-related content.