YouTube and Universal Music roll out new music website: Vevo

Kanye West, an artist signed to Universal Music Group (Reuters)

Universal Music Group (UMG) and YouTube formally announced today Vevo, their expected music video web venture.

Specific details of how the site will work is still pretty sparse; it will be “ready later this year,” will include content other than music videos, and options to buy merchandise and concert tickets, the companies said.

Vevo is the first satellite web site for YouTube, and the move should be seen as a concession since it detracts from the value of YouTube as a portal and an interlinked community.

Google (GOOG) CEO Eric Schmidt reportedly said at a joint press conference with UMG he hopes to introduce additional YouTube satellite sites in the Vevo mold.

UMG chairman and CEO Doug Morris said his company now earns roughly $70 million per year on music video distribution, after having lost about that same amount on music video production for unpaid promotion in the past.

UMG is the most-viewed YouTube channel of all time, with 3.8 billion video views.