YouTube’s New Streaming Service vs Indie Labels

by Martha Rowsell

 

YouTube has become one of the most important and beloved sources of music consumption. It allows artists, labels, fans, and music professionals to share music in combination with visual art. The intimacy of live streams and homemade videos has always been a feature of YouTube that appeals to indie artists and fans alike. Curating playlists and personalised channels has become a new art form. There is, however, a new development that has sparked a lot of media interest recently. YouTube is starting its own streaming service, and the proposed contracts for labels and artists are not to everyone’s taste.

 

What is the new Service?

YouTube
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YouTube’s new streaming service is currently being tested. It gives people the ability to pay for an ad free YouTube experience, joining the ranks of Spotify, Deezer, Beats Music, and many other streaming options. However, YouTube’s proposed contracts with major and indie labels have recently come under scrutiny from sources such as the Financial Time, Billboard Magazine and The Guardian for being unfairly biased against the smaller players in the music industry.

 

Why do indie labels feel threatened?

The Worldwide Independent Network (WIN) has said that YouTube’s contracts are unfair towards indie labels. WIN has been the most proactive organisation against YouTube’s proposals, and it’s a big deal – the organisation promotes the global indie industry, which “boasts the second largest global market share after Universal.” YouTube wants to offer the same blanket contract to indie labels as it has to Universal, Warner and Sony, regardless of the obviously huge difference between the kinds of artists and income levels they represent. The contract is also apparently non-negotiable, and comes with threats of blocking and removal if refused. Not the nicest way to negotiate. As Billboard reports, the labels and artists represented by WIN are by no means minor, including acts such as “Adele, The White Stripes, Radiohead, Queens of the Stone Age, Vampire Weekend, The xx, M.I.A. and Grimes, among many others.” Fans certainly wouldn’t want these artists’ catalogues blocked from YouTube’s new streaming service.

According to the Financial Times, YouTube’s head of content and business operations Robert Kyncl has said: “Record labels representing 95 per cent of the music industry have signed up to the new terms”, and “The remainder, which are asking European regulators to examine whether Google is abusing a dominant market position, will be blocked from the platform.”

 

The future

Nobody can accurately predict what the long-term effects of YouTube’s streaming service will be. Perhaps they will change the contract, to reflect the importance of the indie market. Alternatively, maybe the indie labels and artists who refuse YouTube’s terms will continue to be successful without being included in this streaming service. However, YouTube is still a critically important way of distributing and promoting your music at the moment. At iMusician we already help artists to use and understand the platform, which is why YouTube’s recent acts are concerning. It’s always been a platform for lesser-known artists to showcase their work, and this shouldn’t change.

Although the fears about YouTube’s abuse of its strong position in the market are justified, there is also no reason that the service should not support the music industry and work with it more harmoniously in future. As the Financial Times reported, YouTube has paid out over $1 billion dollars to music industry rights holders since its acquisition by Google in 2006, and this number is expected to double!