How a joint venture between Sony Music Entertainment and Universal Music Group used to treat its clients

It is necessary to have more than one elite music video platform available
>> PUBLISHED ON OCTOBER 2, 2019
IN A NUTSHELL:
>> Prepared by Vladimir Milicev, CEO of VIDYPS 79 d.o.o. and Blue2Digital
Throughout the period 2012-2015 our company VIDYPS 79 d.o.o. acted as a music distribution service on a link between its clients and multiple digital music platforms including Vevo, Google Play, Spotify and many others.
Vevo was a respected on demand advertising supported video streaming service, owned and financed by a few major labels including Universal Music Group and Sony Music Entertainment. In 2012 VIDYPS 79 launched Blue2Digital as one of the most popular independent services distributing videos to Vevo and YouTube. It operated successfully all the way up until April 2015, when Vevo sent us the delayed royalty reports for January 2015 (as the first in a row) that did not reflect the actual number of views generated from the videos owned by Blue2Digital's artists.
Millions of video views were missing (especially the most valuable ones made by the viewers in the United States) and we refused to send such doctored reports over to our clients. Instead of providing us with genuine data, which we, adamantly, were insisting on, Vevo decided to take down the videos distributed by Blue2Digital. This was done without any prior notice, warning or explanation, because of Vevo's apparent inability to respond to our inquiries in a fair and professional manner. We got overwhelmed by tons of emails from our angry clients, but we were unable to tell them anything more about the occurrences at that moment. Vevo officials wouldn't reply to our emails or return our phone calls - the videos were removed insidiously on a Friday afternoon, just before the weekend.
Vevo LLC eventually suspended any further payments to VIDYPS 79 d.o.o. having left an enormous debt of hundreds of thousands of dollars unpaid to our company and its clients.
ALSO READ:
.:: Why did VEVO actually shut down its on demand video streaming website and apps?
.:: Then and now: The reasons why you should not send your video to Vevo anymore
.:: Meet the New York based company suspected of an unauthorized use of around 1,000 music videos on Vevo
THE MORE VIEWS ONE VIDEO HAS, THE MORE MONEY IT WILL MAKE:
Despite being caught by suprise, we came round quickly and it didn't take us long to puzzle out what it actually was about. Vevo let the revenues increase more and more over the months and just before the time they were to pay us our share, they cut off the views and revenues accordingly. The royalty reports were made and delivered to us on a regular basis since 2012. Other than some minor issues, no suspicious activity had ever been detected from our videos for any period till that day. How were we supposed to explain such an overnight drop off in views and revenues to our clients?
It seems that we were expected to obey and restrain from raising any questions. Still, we importuned Vevo to give answers to some questions they found unsuitable to give any answers to. They were enough of it and wanted to teach us a lesson by taking our videos down.
It made no sense to distribute new videos to Vevo anymore. Before going public, we had to prove this thesis and it was by no means easy. It took us quite a lot of time to collect evidence; to put it mildly, we felt indignation at having been treated unfairly.
IN THE COURSE OF EVENTS:
There was no public proclamation made by Vevo until May 12, 2015, when Vladimir Milicev, CEO of Blue2Digital, got a scanty, deficient email from Armand Adams, Coordinator at Content Operations at Vevo:
"We have detected some suspicious activity from your account which we are currently investigating. In order to properly protect ourselves during this process, your videos have been temporarily hidden until further notice."
Armand Adams, Coordinator at Content Operations at Vevo, stated that 'we have detected some suspicious activity from your account which we are currently investigating. In order to properly protect ourselves during this process, your videos have been temporarily hidden until further notice.'
In other words, Armand Adams says that there is "some suspicious activity detected" on nearly 1,500 videos distributed by Blue2Digital, which puts their Vevo in risk of being exposed to danger. Also, he states about the activity "currently being investigated", which implies that the "investigation" started on the day when the videos were "temporarily hidden".
In fact, things went a little differently. In January 2015, there to say, more than 4 months prior to the day of removing the videos, we noticed a "problem" with the video counter on Vevo.COM and so did our clients. The January royalty reports were heavily delayed and we felt something wrong was going to happen. When the reports were finally sent to us on April 13, we saw a huge drop off in views and consequently, drastical decrease in revenues. Vladimir Milicev, being a contact person in charge, reported the issue on the same day of receipt, but we had to wait a few weeks before Vevo had decided to get back to us.
WHAT HAPPENED AFTERWARDS?
Nobody really understood what Vevo was up to. They had never reported any suspicious activity upon any of the videos distributed by Blue2Digital (other than some minor issues) and we were distributing videos since 2012. And then, they came up with "distressingly serious" affairs which caused 1,500 videos to go down, all within a couple of hours!
Two weeks had passed before Armand Adams, Coordinator at Content Operations at Vevo sent another email stating that "with the exception of the below videos, all VIDYPS79 uploads will be live again within ~2hrs". There was a list of 25 "blacklisted" videos that were not supposed to go live again:
On May 22, 2015 Armand Adams, Coordinator at Content Operations at Vevo sent another email stating that 'with the exception of the below videos, all VIDYPS79 uploads will be live again within ~2hrs'
At first sight, Vevo's investigation seemed fruitful. The videos despatching "suspicious activity" that Vevo had to protect itself from were finally located, singled out and disclosed. They must have been jeopardizing the whole system and their creators were expected to be banned from Vevo for a lifetime. Is this the way it happened?
Not exactly. Despite the said, most of the "incriminated" videos were restored too. So what's the point of it all? The following farce of situation and shameful dialogue will help us understand it better.
Namely, one of our clients, C.L., whose video was blacklisted and wasn't among those to be "live again within ~2hrs", contacted Vevo saying that "she is absolutely devastated and have no idea why her video is not there anymore" emphasizing that "she is not trying to make any money from Vevo".
Instead of telling her that she was not welcome on Vevo anymore because of "suspicious activity" detected from her video, Eric Heffler, Coordinator at Content Operations at Vevo, forwarded her email to Vladimir Milicev and said something amazing:
"Vladimir, please confirm this video should be live again and we will push out" (?!)
On June 19, 2015 Eric Heffler, Coordinator at Content Operations at Vevo, forwarded her email to Vladimir Milicev and said: 'Vladimir, please confirm this video should be live again and we will push out'
We then see Christopher Maehr, Director of at Content Operations at Vevo, bringing in even more confusion and frivolity by saying:
"C.L. - we'll look into this and get back to you first thing on Monday. Thanks."
On June 19, 2015 Christopher Maehr, Director of at Content Operations at Vevo, is bringing in even more confusion and frivolity by saying: 'C.L. - we'll look into this and get back to you first thing on Monday. Thanks.'
Eventually, on June 22, 2015 it's Armand Adams, Coordinator at Content Operations at Vevo, to confirm one more time and make it sure:
"Hi C.L., I'm very sorry for the trouble. Your video is now live with views and statistics intact."
Eventually, on June 22, 2015 it's Armand Adams, Coordinator at Content Operations at Vevo, to confirm, one more time: 'Hi C.L., I'm very sorry for the trouble. Your video is now live with views and statistics intact.'
Is there anyone who understands why this video was removed for, apparently, no reason and then set to live again? Did Vevo do it just for fun to show how forceful they were? Or is it because the artist said she wasn't trying to make any money from Vevo? "Feel free to keep my royalties, I still love you and I trust you only" - maybe it sounds good to Vevo's ears, but it's not the way serious people should run the business.
EPILOGUE: WHY IT IS NECESSARY TO HAVE MORE THAN ONE ELITE MUSIC VIDEO PLATFORM AVAILABLE
Vevo was by far the most valuable music video service those days and hence they thought they could do anything they wanted to: produce the views, or reduce the views; release the payment, or withhold the payment; take the videos down, or bring them up again, as many times as they pleased, all without consequences. They aborted any further payments to VIDYPS 79 having left an enormous debt of hundreds of thousands of dollars unpaid to our company and its clients.
Our own investigation revealed that Vevo was dealing with indeterminate business entities suspected of being intent on taking the control of the flow of digital sales revenues, individuals who created and submitted forged, falsified and altered documents, improperly counting the video views which (in)directly caused its video-hosting service to shut down, or unauthorized use of around 1,000 music videos previously distributed by our company to their platform.
The fact that Vevo was not capable of detecting fraudulent activity and providing accurate royalty reports and statistics implies that the advertisers were paying for their ads to run on videos with millions of fabricated views. Vevo never reported if they had returned the money to the advertisers. It is impossible that it would take them more than 8 months (as said by themselves) to notice there were tens of millions of fabricated views, unless this is just what they wanted to achieve.
As a result of such behaviour, our company and its clients have suffered both material and non-material damage. Every effort we made to reach an agreement and settle the matter was arrogantly ignored.
Having considered all the facts and results of our investigation, we had no other choice but turning Vevo, companies and individuals associated with them in to the U.S. Authorities. On August 30, 2017 and November 15, 2017, the report was submitted to the IC3 via WWW.IC3.GOV.
Shortly after the submission of our report, on December 15, 2017 Vevo's board of directors announced a "leadership transition at the world's leading all-premium music video and entertainment platform". Erik Huggers, Vevo's President and CEO since 2015, had decided to step down to "pursue new opportunities".
Expectedly, on May 24, 2018 Vevo announced "changes to its owned and operated platforms" which resulted in Vevo shutting down its video-hosting service.
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