YouTube: Friend or Foe of the Music Industry
More people use YouTube as a music discovery tool than any other online platform. For us, it’s a fantastic resource, but because of the nature of YouTube payouts, musicians and the music industry aren’t crazy about it. In fact, they hate YouTube. Mike Raine at Canadian Musician magazine took at look at the situation.
Two related themes have dominated music industry discussions and reporting over the last couple of years. From industry conferences at Canadian Music Week and South by Southwest to reports by the BBC and New York Times, there has been jubilation over revenue growth. Subscription streaming services like Spotify are credited with fueling a 5.9 per cent worldwide growth for the recorded music industry in 2016, which is the largest year-over-year increase since IFPI began tracking the market. In Canada, the growth was even more dramatic at 14.8 per cent thanks to streaming revenues more than doubling. On the flip side, though, is fretting and even outright anger over the paltry royalties the largest online service, YouTube, pays music rights holders.
Many have not been shy about their feelings, with Metallica’s manager, Peter Mensch, even saying in a BBC Radio 4 documentary last year that YouTube is “the devil” and, “If someone doesn’t do something about YouTube, we’re screwed. It’s over. Turn off the lights.” Maybe a bit melodramatic, but the point is clear and widely shared: YouTube’s current business model is a problem for the music industry. But how is it a problem, and can it be fixed?
Sensing that the ire of musicians, labels executives, publishers, and even fans was shifting from music streaming services to YouTube, the Google-owned service’s chief business officer, Robert Kyncl, went on the offensive. He revealed in a December 2016 blog post that “in the last 12 months, YouTube has paid out over $1 billion to the music industry from advertising alone, demonstrating that multiple experiences and models are succeeding alongside each other.”
A billion dollars is an impressive figure, but it doesn’t tell the whole story.
Read the whole post here.
