Warner Brothers and YouTube have reached a deal for the use of WB music on YouTube

Under a revenue-sharing deal announced Monday, New York-based Warner Music has agreed to transfer thousands of its music videos and interviews to YouTube, a San Mateo, Calif.-based startup that has become a cultural touchstone since two 20-something friends launched the company in a Silicon Valley garage 19 months ago.

The best part in my POV is this:

Perhaps even more important for YouTube is that Warner Music has agreed to license its songs to the millions of ordinary people who upload their homemade videos to the Web site

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To make the deal happen, YouTube developed a royalty-tracking system that will detect when homemade videos are using copyrighted material. YouTube says the technology will enable Warner Music to review the video and decide whether it wants to approve or reject it.

So long as they don’t get too heavy handed in rejecting things, this is a terrific step forward in legitimizing the value of fans’ creative activities.