The Deal With Independent Music Getting Pulled from YouTube
Well now, it looks like the massive, unfettered expansion by pretty music every information provider into the realm of digital music streaming has finally hit a snag. It’s hard to say this couldn’t be expected. With all this cheap or free music being provided to everyone’s fingertips through their phones and mobile devices, at some point it was feasible to think that someone was going to have to pay for it. The last few years in digital music have been like the industrialization in the 80’s: unregulated and unnatural aggrandizement that eventually the future will have to pay for in the form of ponying up for unpaid bills and cleaning up polluted resources.
Here’s there long and short of the current problem: Just like iTunes, Beats, Amazon, your local school district, and your refrigerator repair company, YouTube has decided it’s getting into the digital streaming music service too. Ironically, YouTube is one of the companies that already has a significant chunk of the digital streaming market, and one of the most significant footprints in the business. It’s just not in a convenient delivery form like its competitors. Look at the chart below, graciously provided to us by the industrious folks at Edison Research. Yes that’s right, not radio, not Spotify, not iTunes or their friends at school, but YouTube is the place that music’s coveted 12-24 year-old demographic goes most to discover new music.
However the problem is YouTube is not really set up like its burgeoning rivals to make the best of the current music streaming paradigm. One of the reasons so many people crash YouTube to discover music is because it is free, gratis, no dough to go there and listen/watch your favorite music, or oogle at all the greatest atrocities modern music has to offer (i.e. Rebecca Black or Billy Ray Cyrus’s “Achy Breaky 2”). So YouTube, or more importantly its parent company Google, wants a piece of the digital streaming subscription pie. Sure, that’s fine, can’t be that hard to do, especially since every else is, right? Wrong. YouTube and Google have hit the mother of all snags, and since Spotify, iTunes, Beats, iHeartRadio, and a litany of other companies continue to gobble up market share, YouTube wants to get into the game sooner than later, and are unwilling to let tired negotiations with independent labels on long-standing licensing issues get in their way.
What does this mean? This means your favorite independent bands could be going away from YouTube. That’s right, that dreaded sign of the little digitized frowny face you see when you roll up on a video that has been yanked? That could replace that perfect song that gets you pumped for your morning workout, or that lulls your little tike to sleep every night. Yeah, totally uncool for you, but think about the artists and labels that rely on the revenue and promotion from YouTube that will be left in a lurch if this seemingly unconscionable decision was allowed to occur.
And occur it might, at least if you listen to the rhetoric from Google. They’re saying the launching of their paid streaming service is “imminent”, and if they can’t reach an agreement with indie labels on licensing, they will have to pull all of the unlicensed music entirely, even from their current free service as not to be unfair to their paying customers.
But let’s not get ready to grab our pitchforks and storm Google’s corporate headquarters just yet. Besides the fact that Google’s headquarters is pretty damn far away from most of us, this could all just be rhetoric to twist the arm of America’s indie labels to agree to Google’s terms. Or even if it is true brinksmanship, like we have seen numerous times with cable providers and content companies, many times even when the content is pulled, it is eventually replaced when cooler heads prevail. It would seem scandalous, and potentially murderous of Google’s YouTube business plan to cheese off all those fans of independent music, right?
Well, maybe. According to Google, their rights beef only pertains to about 10% of the music represented on the site, despite independent music making up a much greater piece of the actual music pie, 32% in fact according to Phonofile. For goodness sake, Adele is officially and independent artist. So is Jack White. We’re not just talking about our favorite local bands anymore who we still pretend to like because we can’t get their damn bumper sticker off our back car window no matter what solvents we try, we’re talking some big, international bands and artists here people.
And let’s not forget that YouTube plays are also pegged to Billboard’s charts now, and so if YouTube’s negotiations with independent labels go asunder and indie media gets yanked, that means less metadata coming into Billboard, and worse chart performances for independent artists.
But there’s hope on the independent music side, because despite the collective of independent music owners representing a pretty motley crue of music miscreants, they have banded together in an organizations called (Don Don Don!!) …. Merlin and A2IM Merlin Network and other such organizations represent the “world’s leading independents” by globally negotiating rights with entities like YouTube to make sure that independent artists get access to formats, and get paid for royalties, which independents have been complaining about for years since they don’t have the same negotiating leverage as the major labels do.
But trust me, this problem goes much, much deeper, and was first signaled when Amazon launched its streaming service last week, but was only able to include 1 million songs compared to the 20 million or so songs of some of its competitors because of similar rights negotiating issues. Long story short, labels of all sizes figured out through the Spotify and Pandora experiments that they were getting screwed, and they are now demanding more compensation. But despite all these companies feeling like it is a must that they get into this crazy digital music streaming business, the financial numbers in many cases simply just don’t add up to profitability unless someone is getting squeezed. And you can’t squeeze the consumer because with so many cheap or free options, they’ll just go somewhere else.
As much as we want to blame companies like Spotify and YouTube for screwing our favorite artists, not all the blame is upon them. Many of these new digital music companies aren’t even pulling a profit themselves. That’s why they’re trying to pay out as little as possible to labels and artists. Why is the money so tight in streaming? Because consumers are demanding these services for cheap or free. You can’t charge more than $9.99 to get unlimited access to every single damn song that was ever recorded in the history of planet Earth when many consumers already feel it is their right to listen to music for free, and there’s services that already offer that. Where does music come from? Do the people who make it have to eat? How about the engineers and producers of it, or the distributors and sellers? Consumers will put hours of time into the endeavor of procuring free music, even if it would be more efficient for them to purchase it in the first place. They will hop fences and commit felonies to obtain free music. In the last few years, for some reason, music consumers have decided that free music is an inalienable right.
Price points killed music. When iTunes pegged the value of someone’s deep artistic expression at .99 cents, we were doomed.
We devalued music with price points. No wonder it sounds like crap. Why do all songs sounds the same? Why are songs written by committee? Why do you only hear the same dozen artists on the radio? Because the music-making process has been automated and streamlined to meet the efficiencies necessitated by consumer’s price point demands. Meanwhile many of the same people complaining about what major corporations are doing to our country are also vested heavily in these same corporations through retirement accounts, 401K’s, or other investments, and by proxy, demand these companies show increasing profits each quarter, putting pressure on executive heads to be bean counters first, and conscious leaders of their respective industries second.
Of course, most of the big music companies deal in outmoded practices as their executives yank the ripcords on luxurious golden parachutes while the company goes down the tubes or succumbs to the massive consolidation we’re seeing to stay afloat. Meanwhile who needs the money more being fought for between Google and independent labels? Last time I looked Google was doing just fine. In many ways independent music is on the brink of extinction as a viable business model. Is Google and YouTube the big bad wolf here? Of course they are. But don’t be afraid to look in the mirror too, Mr. Modern Day Music Consumer, when laying blame for the ills of today’s music.
One way or another, this YouTube / independent label issue will be resolved. And if it isn’t, another video solution will pop up in its stead to serve indies, or is probably already out there in the form of Vimeo and other established video forms, because that’s the way these things work. Will it be inconvenient? Will it be costly? Sure. But wanting everything free and easy is one of the problems that got us here.
June 19, 2014 @ 9:06 am
Great article, Trigger. Really hit all of the main points of this issue and I’m glad you called out music consumers. You’ve said if before and independent artists say it all the time: If you love your independent artists’ music so much, buy it and support them. Don’t steal it. As the old saying goes, you get what you pay for. I can go to McDonalds and get a cheeseburger for a $1 or go to Five Guys and get one for almost $5. Sure I’m paying more for Five Guys, but the quality of the product is much better. I hope YouTube and the independent artists come to a fair deal, but I sadly don’t see it happening. As you mentioned, Vimeo will gladly scoop these artists up. And this might not be the worst thing because YouTube needs competition.
June 19, 2014 @ 9:09 am
I primarily see lesser known, or indie bands. This will kill a greater part of their ability to reach out to new fans. I often check out my friends suggestions on youtube to find out about the band’s live performance.
Let’s face it, nothing beats being there, but the essence of the show can be captured by video.
Guess my 1,900 lesser known band videos on youtube will be taken down. I know I won’t be watching, so their advertisers won’t see my dollars.
June 19, 2014 @ 9:11 am
Just sounds like the direction everything on the internet is going
Youtube will make sure the big “stars” get their say at the expense of the independents.
Losing Net Neutrality will make sure the big companies get their say at the expense of the mom&pops.
And the Lobbyists will make sure the big FCC gets their say at the expense of the taxpayers who actually built the internet.
‘Cause the times they are a’changin’!!!
June 19, 2014 @ 9:24 am
I agree consumers and the corporations are both at fault and the artists pay the true cost. I prefer to buy a CD and rip it at the highest quality so that I have bought the whole album and can shelve it and listen to my digital copy. Market share, price points, stock prices and shareholder expectations all kind of make me depressed. Yes, make a profit, shit, go on and become wealthy, that’s all fine with me, but there seems to be no balance at all. Not that musicians have not been getting screwed for a long time, but we are at some sort of pinnacle it seems. The “Biz” seems to be clawing it’s way to the top of the manure pile, clamoring for one last dollar being dangled from the heavens.
June 19, 2014 @ 10:36 am
Then again, I go to 8-12 live music shows per year at which I cheerfully pony up $20 to get in and almost always spend another $20-$30 on a tee shirt, sometimes a package of stickers or a CD, and during which I drink three or four $6 pints of beer.
How did I discover most of these bands? Besides blogs and word of mouth, most of them, I find through my $10/month unlimited google music subscription. Small club music is alive and well.
June 19, 2014 @ 10:46 am
Please don’t think I’m bagging on people who use subscription services. I use a subscription service to fill in the blanks of music I want to review for the site but don’t have physical copies of. But not everybody is supporting the music in other ways like we might. The general music consumer in 2014 feels like free music is an entitlement, and that is what is concerning, and that is what is setting the parameters for these companies like YouTube to do business in, resulting in the potential of most independent music getting pulled from the site.
June 20, 2014 @ 9:41 am
Do you know the % breakdown for artist revenue sources? I have often justified listening to free (ad supported) music reasoning that live performnace and merchandise revenues offset the decline in CD/vinyl/digital music sales.
June 22, 2014 @ 8:06 am
Here’s an example of from one anonymous indie label on how much their clients are paid out: http://www.digitalmusicnews.com/permalink/2014/02/21/favoritepays
I’d assume the reason the percentages aren’t widely known is because different services have different agreements with each label they have a contract with, and don’t want the other labels or their competitors knowing what that number is. In any case, it made me a bit happier with my choice of going with Google Music over Spotify. We’ll see how they handle this Youtube rollout, though.
June 19, 2014 @ 12:24 pm
Before I discovered this site, and to this day, I discovered a lot of good music through Youtube. I wouldn’t have heard of Rachel Brooke, Those Poor Bastards, Strawfoot, etc.
Big thing is, at the end of the day, I bought the Damned Record (or CD, or digital copy, or whatever). I am kind of in the dark ages when it comes to some stuff. I don’t have a fancy I-Phone thing. While it’s nice to ride in a vehicle with Sat. Radio, I don’t have it in my own personal vehicle. I rely on CDs in a case. Hence why I buy the Damned Record.
June 19, 2014 @ 12:37 pm
Free music isn’t the only thing that people feel entitled to. I’d guess that close to 50% of Americans think they’re entitled to lots of things for free: college, healthcare, phone service, electricity; the list gets bigger all the time.
I agree with Brad though. I still like to buy cd’s, so I’ll always have a physical copy.
June 19, 2014 @ 8:08 pm
This is right on! I agree 100% . Part of a larger issue.
June 19, 2014 @ 1:40 pm
“On my phone I can get an app for $0.99 cents. That makes fart noises – same price as the thing create and speak to the world with… Creative brains are being sorely mistreated.” – Vince Gill
June 19, 2014 @ 1:43 pm
Well this is kind of catch 22. I don’t want to pay for “crap” music. And yet you get “crap” music when you don’t pay. I am lucky enough to live in an area where music stores still thrive and that is where a lot of my discoveries happen. I browse the bins and stumble upon some cool album or, or I hear a song overhead the girl behind the counter is blasting, or I bump into somebody whose browsing the same artist bin and we get to talking.
But YouTube has been amazing for finding stuff I haven’t heard before and would never hear otherwise. I would never get to hear much African or Japanese music otherwise. And all the vinyl junkies posting their rare club remixes and obscure acquisitions from their collections has truly expanded my musical tastes. I’ve learned about deceased labels and quirky little niche genres from past decades this way. I click on a song and then the sidebar has all these links to similar things and down the rabbit hole I go. Some stuff you can’t find on iTunes or Amazon.
Of course before all this and before Napster I was just ignorant to it. And one might be able to argue you can be over saturated with music to the point you have tons of it but don’t really appreciate any of it fully. Digital music does take up less space. But I refuse to give up my CDs because I am afraid of the WWW crashing and having to rebuy what I had. Plus so many of my CDs are signed. But also the joy of an ALBUM as complete little ten song work of art you listen back to front is a kind of treasure to me. The idea that the artists not only made the recordings but made decisions on the track order and what tracks to include is kind of awesome…
We’ll it’s a tricky thing, making money doing art. People don’t want to pay me what I’m worth as an artist (illustration/graphic design) either. I’ve been told they will just Google images and clip art and make their own stuff and not have to pay me $200. My photographer friend said the same about art photography (especially landscapes and travel photos), everyone is a photographer. True but most of it looks like shit you find @ the $0.99 store
June 19, 2014 @ 2:15 pm
One piece of the puzzle that no one has mentioned has to do with how modern technology and streaming services have lowered the barriers to entering the music marketplace — a change that’s been very good for independent artists. It’s never been easier or cheaper than it is now to record a song and make it available to literally anyone in the world with an internet connection.
A lot of artists have a legitimate beef with the deals record labels have inked with the streaming services, but let’s not pretend that there aren’t some serious advantages for artists too.
If you’re good, you can still make a living in the music business, but it’s not going to happen unless you adjust to the new paradigm. (Sorry for sounding so Lefsetzian. It’s making me feel like I should take a shower.)
June 19, 2014 @ 3:38 pm
Hey Trigger – How are they going to decide who is and who isn’t an independent artist who needs to be removed. For instance, I’m as independent as they come, but I don’t have an “indie label” – I just have me, some band mates, and a studio in which to record. Just wondering if they’ve worked out WHO will be excluded. In the world of YouTube, I’m a minor player”¦will they even notice my little account?
June 19, 2014 @ 3:57 pm
A lot of this is why there is a big question of just how much music is on the block to be banned if agreements can’t be met. I’m not really sure anyone knows as this point, and the blocking of music could be incremental. How big or small you are may not matter. What matters is how and where your music is licensed. If it is licensed through a label, then the question is, has that label worked it out with YouTube? Maybe they haven’t, but maybe they are part of Merlin, or some other organization that is negotiating these rights collectively. If you used someone like CD Baby to publish your music, there may be certain stipulations that would allow your music to stay up, or would be the reason it is taken down. I contacted half a dozen independent labels whose artists are regularly featured on Saving Country Music to ask them to give their thoughts, and how it would affect them. To a man, they didn’t really have any answers, because they don’t know if it will affect their catalog or not. If you’re a random artist with no publishing, will your songs get pulled? I really have no idea, and I don’t think that information is available right now, and it may not be determined yet. I feel pretty confident this won’t affect live videos and such, but I don’t think there’s any guarantee of that either. The uncertainty of what is going to transpire might be the most troubling part about this. And that all of this could go down in a matter of hours.
June 19, 2014 @ 7:41 pm
You got me nervous for a second there. Just to comment on one point you made about the reasons why songs sucks these days. I don’t think big business have anything to do with the crap we are hearing. By saying that you are taking the responsibility off the people who are actually writing these crap. I am beginning to think that the average mainstream artist would be willing to record a song that will not be laughed at on SCM,a song that would not subject them to marque Trigger’s extensive vocabulary. I am sure there are a few of them that would appreciate a writer who can actually shut Trigger up.