Music companies are planning to create their own video site, which would compete directly with YouTube, owned by Google, the Sunday Times reported.

Warner has demanded that YouTube takes down videos that feature songs the record label owns the rights to. This even includes Happy Birthday to You and Winter Wonderland, which Warner owns the rights to.

Google is currently in talks with other music groups EMI, Universal and Sony. Although Warner stated it made little from YouTube, Universal, the largest music firm, announced it made "tens of millions" from its contract, according to the Sunday Times article, posted by Times Online.

Labels make most of their money from "pay-per-play" fees YouTube pays them each time a video is viewed, as the site has a hard time selling ads against its content, most of which is created by users.

Meanwhile, music industry executives are modelling their plans for a music site on Hulu, which shows videos following a short advertisement, according to the Sunday Times. The AP also named Hulu the Web site of the year for 2008.