Is the IFPI impressed with YouTube’s claim that it has paid $1bn out to the music industry in 2016 from ads? Entirely unsurprisingly, it isn’t, saying that the announcement “gives little reason to celebrate”. In a statement published on the music body’s website, it explains why.

“With 800 million music users worldwide, YouTube is generating revenues of just over US$1 per user for the entire year. This pales in comparison to the revenue generated by other services, ranging from Apple to Deezer to Spotify,” it claims. “For example, in 2015 Spotify alone paid record labels some US$2 billion, equivalent to an estimated US$18 per user.”

Cue a now-familiar demand for legislators to address the “value gap” between YouTube consumption and payouts. With legislators still deliberating in the US and EU on how safe harbour rules should be modernised – and with major labels yet to sign new licensing deals with YouTube – tensions will continue to bubble into 2017.

Next year feels like a crucial one for this relationship, from the results of the safe-harbour consultations to the new licensing deals – or, as we explored in our last Music Ally Report, the prospect of one or more labels pulling their content from YouTube entirely.

The rhetoric of the ‘value gap’ debate often makes the prospect of middle ground and a long-term, constructive partnership seem unlikely, yet a permanent fissure would harm both sides.

YouTube IS important to music, and music IS important to YouTube. If 2016 goes down in industry history as a tipping point for subscription streaming, we must hope that 2017’s tale will be a proper solution to the YouTube/music question, not just more simmering tensions.

EarPods and phone

Tools: platforms to help you reach new audiences

Tools :: Wyng

Through Music Ally’s internal marketing campaign tracking, we’ve recently discovered an interesting website by the…

Read all Tools >>

Music Ally's Head of Insight

Leave a comment

Your email address will not be published. Required fields are marked *