Amateur videos on featuring copyrighted songs on YouTube are being muted or removed, due to a failed deal between the video site and Warner Music Group. The disagreement revolves around the fees paid to Warner for the use of its music videos. Since YouTube uses an automatic process to find unlicensed material on its site, videos of amateurs covering songs and using copyrighted background music are targeted. Will Tanous, a spokesman for Warner Music, defends the company’s position:

“We and our artists share the user community’s frustration when content is unavailable. YouTube generates revenues from content posted by fans, which typically requires licenses from rights holders. Under the current process, we make YouTube aware of WMG content. Their content ID tool then takes down all unlicensed tracks, regardless of how they are used.”

YouTube spokesman Chris Dale said, “While we work with music labels to keep music on the site, sometimes our negotiations don’t pan out, and we understand that this can be a big disappointment to our community.” The reasons behind the failed deal could be on par with YouTube’s recent disagreement with the PRS.

Warner argues that the amateur videos, while created for noncommercial purposes, are nevertheless distributed on YouTube, which has revenue from advertisements. Are Warner’s demands so high that YouTube doesn’t have enough to pay them? Analyst estimates of YouTube’s yearly revenues range from $200 million to $500 million. Still, the amateur videos are being removed. Who do you blame, Warner or YouTube?