N.Y. Times: Music Industry Has YouTube In Its Crosshairs
June 1, 2016 at 1:17 PM (PT)
The music industry has its sites set on YOUTUBE, according to an article in THE NEW YORK TIMES.
Led by IRVING AZOFF, the industry has charged the service with paying too little in royalties and asking for changes to the law that allows the company to operate the way it does. The battle shows the desperation to capture every dollar as listeners’ habits turn to streaming, as well as the industry’s complicated relationship with YOUTUBE.
KATY PERRY, PHARRELL WILLIAMS and BILLY JOEL have all signed letters asking for changes to copyright laws. Annual sales statistics were released showing that YOUTUBE, despite its gigantic audience, produces less direct income for musicians than vinyl record sales.
With more than a billion users, YOUTUBE has long been seen by the music business as a vital way to promote songs and hunt for the next star, though it has never been a substantial source of revenue and often is a source for leaks and unauthorized material.
It's no coincidence that the major record labels are in the midst of renegotiating their licensing contracts with YOUTUBE this year.
In its latest effort, the music industry has asked the federal government to change the DIGITAL MILLENNIUM COPYRIGHT ACT, saying that the law, which was passed in 1998 and protects sites like YOUTUBE that host copyrighted material posted by users, is outdated and makes removing unauthorized content too difficult.
YOUTUBE's chief business officer, ROBERT KYNCLI, said that since its inception in 2005, the site has paid $3 billion to the music industry around the world.
“Music matters tremendously to us,” KYNCL said. “Artists matter to us. We are connecting artists and fans on our platforms.”
He also pointed to the site’s new subscription plan, YOUTUBE RED, and said its copyright protections were functioning as they should.
“We are working to create what has become the most significant revenue generator in the entertainment industry,” said KYNCLI, “which is a dual revenue stream where you monetize all people: heavy users through subscription, and light users through advertising.”
SPOTIFY paid about $1.8 billion last year for music licensing and related costs, according to the company’s annual returns, although the average royalty rates for its free tier are not much different from YOUTUBE’s, by some estimates.
The fight over the DIGITAL MILLENNKUM COPYRIGHT ACT has touched a nerve. The law gives “safe harbor” to Internet service providers that host third-party material. While music groups criticize the law, some legal scholars and policy specialists say any change to it would need to be considered carefully, particularly to preserve protections like fair use.
In DECEMBER, the U.S. COPYRIGHT OFFICE asked for comments about D.M.C.A. as part of a review of the law, and filings by record companies show how laborious copyright policing can be.
YOUTUBE says that about 8,000 companies and organizations have access to Content ID, their takedown process, and that independents may get access through affiliated companies and industry groups.