The U.S. Copyright Office has invited the public to comment on potential reforms of the DMCA “safe harbors” and the incomparable T-Bone Burnett delivered this video version of his insightful comments on DMCA abuse. (See also Billboard article on T-Bone’s comment and my 2006 post on MTP, The DMCA is Not An Alibi.) It is important […]
All of the downside but none of the upside. Another reason why we say legacy revenue share deals have to go.
YouTube and Vevo streams increased 132% last year, but revenue paid to artists only increased 15%. Make sense?
The argument over whether YouTube is paying labels and artists fairly has been intensifying for some time. But, that argument is about to reaching a boiling point following recent findings.Here’s the bombsell: Midia Research has now concluded that the revenue paid to music labels and artists halved last year relative to the number of streams. That is, dropped by 50%. This translated to a potential revenue loss of $755 million for the industry
The numbers are easy to calculate. Last year, streams on YouTube and Vevo grew 132%, but revenue to rights holders only increased by 15% within the same time period. As a result, the streaming platform’s already low per-stream royalty rate dropped from $0.002 per stream in 2014, to just $0.001 in 2015 (according to Midia).
Looked at from another angle: if the per-stream royalty rate had remained constant, music labels and artists would have earned double.
The discovery could provoke a massive reaction from the music industry. The main issue that artists and labels have expressed is that streaming services like Spotify and Apple Music pay rights owners a per-stream royalty rate regardless of the revenue they earn. By contrast, YouTube pays a share of their revenue. “Labels are not used to being paid based on how profitable the company is,” said Mark Mulligan, analyst at Midia Research.
So what’s going on? The reason why labels and artists are being paid less — despite a boom in streaming — is reportedly because ad prices dropped last year, which ultimately reduced ad-revenue.
The drop represents the latest face-slap from a company increasingly viewed as hostile.
Google’s response to the artist rights movement has been to form organizations of their own through proxies (and if you look like a proxy and talk like a proxy, and if you’re largely or entirely dependent on your public profile and artist income stream on YouTube, don’t be surprised if people think of you as a proxy).
Now we have the Internet Creators Guild that is funded by VidCon (sponsored by YouTube) according to this Medium post by Hank Green (who you will remember went after Irving Azoff for Irving’s critique of Google). Some will say that Google has no influence over VidCon, Mr. Green or his new organization, but ask yourself this–if there were no YouTube, would there be a VidCon?
Hank Green and his brother evidently own Vidcon LLC and have registered the domain name, although Vidcon uses a PO box in Montana for its address. (Vidcon is a large convention of YouTubers and brands now in its 7th year that has panels about everything YouTuber except for criticism of YouTube’s royalties, advertising practices, but why would they? Everything is awesome!)
You know that certain nausea that you get from the over-hyping and over-corporatizing of SXSW that culminated with Lady Gaga’s vomit artist? That’s because SXSW used to be organic so you are comparing the current corporatized state to the once organic state. Vidcon never was or was intended to be organic and has always been a kind of Google version of the Hunger Games the brings together YouTubers who don’t know better with brands who do.
Good timing for Mr. Green to launch the “Internet Creators Guild”–his Vidcon just happens to be next week (June 23-25) at the Anaheim Convention Center. So what is Hank up to with this Internet Creators Guild? Spoiler alert: It’s not a union…because unions focus on fair working conditions and collective bargaining with employers. And Green’s Vidcon ain’t gonna encourage that sort of thing, no, no, no. Did we say that Mr. Green’s Vidcon is funded by YouTube as a title sponsor?
In his Medium post, Hank gets in a slag at the “notoriously cut-throat entertainment industry”, conveniently ignoring the inconvenient truth that his organization is founded with money from notoriously cut-throat Google. We don’t recall anyone in the music business paying a $500,000,000 fine for advertising illegal drugs as Google did. And then there’s Machinima’s fake endorsements. Mr. Green is apparently unperturbed:
And where does VidCon get its money from? In part from its title sponsor, YouTube.
Once you understand that YouTube uses Vidcon to cement its monopoly on video search and as a charm offensive to serve up Kool Aid to YouTubers, it will become apparent why there evidently are no topics at Vidicon that cast YouTube in a negative light.
And here is the Internet Creators Guild’s mission statement, pay close attention to the highlighted points:
Mr. Green’s most recent foray into “unifying the voice of online creators to create change” was his attack piece on Irving Azoff and the artists who oppose YouTube. That post certainly appeared designed to be “riling up angry mobs” and was no evidence of a desire to “work with other stakeholders to move forward” probably because Irving was from the “notoriously cut-throat entertainment industry”.
One of the first of ICG’s initiatives will be a “knowledge base” of common questions and answers about managing an online video business and other resources. For instance, “what do I do if my video gets wrongly claimed for a copyright strike?” [surprise surprise] or “when do you think it’s okay to ban a commenter?” or “does putting copyrighted music in my video result in it getting more or less views?” [Leaving aside how the Guild would know the answer, want to bet what the answer is?
The site will also explain the contracts that creators often sign with these sponsors and with MCNs, networks that support channels with marketing, funding, and other efforts, usually in exchange for a percentage of their revenues. [But not YouTube deals or Google’s CPMs.]
This would of course explain why we hear that Mr. Green is calling independent labels on behalf of YouTube to talk them into how groovy YouTube is. Is that lobbying?
Mr. Green has a long way to go to earn the right to actually represent other people, not to mention having his bona fides taken seriously by “other stakeholders”. We’re glad he’s making money from Vidcon and the blur of sponsorship logos rivaled only by NASCAR drivers. No one begrudges his ability to make money from YouTube that makes money by screwing artists, songwriters and musicians, but since it does Mr. Green should expect some scrutiny.
Mr. Green has already shown his hand as advancing the Google agenda. He should expect close scrutiny of his organization. Starting with the unpaid volunteers.
Because everything is not awesome.
Nine Inch Nails’ Trent Reznor is the latest artist to join the music industry’s war of words with YouTube, attacking Google’s video service over the role it plays for musicians.
“I find YouTube’s business to be very disingenuous. It is built on the backs of free, stolen content and that’s how they got that big,” said Reznor in an interview with Billboard.
Reznor was not speaking purely as an artist, however. He is also chief creative officer at Apple Music, the streaming service launched by Apple in 2015, which is one of the key rivals to YouTube in the digital music world.
“I think any free-tiered service is not fair. It’s making their numbers and getting them a big IPO and it is built on the back of my work and that of my peers. That’s how I feel about it. Strongly,” said Reznor, widening his criticism to other rivals like Spotify in the process.