Warner Music Group & YouTube Make A Smart Deal

There's certainly a lot of interesting movement as old media gets new and the deal between Warner Music Group and YouTube seems like a big development for all concerned.

I actually read Mark Cuban's dismissal of YouTube's future before I read the announcement.  He feels that YouTube's potential due to copyright violation issues is overwhelmingly negative and that companies like Universal will attack, one way or another.

But Warner Music Group's announcement is important because it not only provides for a legal use of Warner's music videos but, in some ways more radically, "YouTube users will be able to incorporate music from WMG's recorded music catalog into the videos they create and upload onto YouTube."

Like the deal that New Line Cinema made with Cafe Press for Snakes on a Plane licensing, opening up the vaults to lip syncers, living room dancers and unofficial video makers will help build community for WMG's artists.

Update:
Here are some key details:
A royalty-tracking system has been developed by YouTube to detect when videos on the site are using copyrighted material and work out how much Warner is owed in advertising revenue...The technology would also enable Warner to review homemade videos and decide whether to approve or reject them.

So they've got a way to get paid but what will they do with their approval power?