RIAA To YouTube's Lyor Cohen: We've Heard It All Before

RIAA: Answering YouTube.

The RIAA's Chairman/CEO CARY SHERMAN has responded to YOUTUBE Head Of Global Music LYOR COHEN's open letter (NET NEWS 8/17) with its own response, "Five Stubborn Truths About YOUTUBE and The Value Gap," insisting, "His optimism is encouraging. But to be honest, we've heard pretty much the same claims and arguments before."

1. GOOGLE’s YOUTUBE exploits a “safe harbor” in the law that was never intended for it, to avoid paying music creators fairly... and gives [it] an unfair competitive advantage that harms the digital marketplace and innovation.

2. The "safe harbor" was intended to protect passive Internet platforms with no knowledge of what its users are doing, not active music distributors like YOUTUBE. That’s precisely why dozens of music organizations and thousands of individual creators across the entire global music spectrum have banded together to protest the existing laws: www.valuethemusic.com 

3. Transparency? YOUTUBE won’t even make public its subscriber figures, and continues to underreport the number of music streams played on its service, let alone substantiate any of its many different claims about payments to music creators. 

4. About 400 digital services have been licensed around the world, many with ad-supported features. Comparatively, YOUTUBE pays music creators far less than those services on both a per-stream and per-user basis, and nowhere near the $3 per thousand streams in the U.S. that LYOR claims.

Last year’s actual payout per 1,000 streams was closer to half that amount, according to industry data and NIELSEN and BUZZANGLE estimates, and seven times less than SPOTIFY, which also is both an ad-supported and subscription service.

The history over that last decade [shows] the contribution of platforms like YOUTUBE to the overall business can only be described as meager.

5. Nine out of the top 10 most-watched videos on YOUTUBE are music videos. According to data from research firm IPSOS, 82% of all YOUTUBE visitors use it for music. So, why is YOUTUBE paying so little? Is this how a true partner values music? We don’t think so.

Concludes SHERMAN, "It’s long past time that the safe harbors -- enacted 20 years ago, in the days of dial-up Internet, and before it was ever imagined that users could upload 400 hours of video to YOUTUBE every minute -- must be clarified to apply to passive and not active intermediaries. To be clear, we believe safe harbors should be preserved (and GOOGLE/YOUTUBE claims that we’re trying to eliminate them is nothing but a red herring). But if safe harbors are to drive innovation and fair competition in today’s digital environment, they must be applied as originally intended, not as they are exploited by YOUTUBE for its own competitive advantage."

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