Youtube has long been the world’s most popular music service. What has changed is that YouTube is no longer the Darth Vader of the music industry.
For years, some artists and suits at record companies loved the tens of millions of clicks music videos received on YouTube, but complained that the Google owned website wasn’t making enough money for them or didn’t do enough to stop copying -Off .
These complaints have not completely disappeared, but most of the time they have stopped. Why? One big reason is that YouTube has found ways to make enough money to keep many people in the music world happy – or at least enough content for now.
The question is whether YouTube has achieved a lasting peace or a temporary one. If it stays that way, YouTube may have achieved something few internet companies have: a relatively healthy relationship with an established industry that it both helps and disrupts at the same time.
Let me go back to the years when YouTube was in the music industry’s kennel. The powers that be in the industry have regularly put out an acronym for public relations, the “Value gap” Because what they said was YouTube’s modest financial contribution to the music industry relative to the popularity of the music on the site. They liked to point out numbers that showed that Vinyl records generated more income for the music business as YouTube.
YouTube made money to musicians, songwriters, and record labels mostly the way Google did: it sold advertisements in or next to music-related videos and shared the money with the people and companies behind the songs. The electricity brokers in the industry said it was peanuts.
Fast forward to last week as YouTube disclosed that it paid music companies, musicians, and songwriters more than $ 4 billion last year. That came from ad dollars and something the industry has always wanted and is getting now – part of YouTube’s surprisingly large subscription business. (YouTube subscriptions include an ad-free version of the website and a Spotify-like service for watching music videos with no ads.)
The importance of the dollar number from YouTube is that it is not far from that $ 5 billion which the streaming king Spotify pays out of part of its subscriptions to the participants of the music industry. (As a reminder: the industry Mostly loves Spotify’s money, but loves some musicians say they missed out through the payouts.)
Subscriptions will always remain a hobby for YouTube, but the numbers show that even a part-time job can be huge for the company. And it bought peace by raining some of those riches on those behind the music. Record labels and other industry powers “still don’t love YouTube,” says Lucas Shaw, a Bloomberg News reporter. wrote in this week. “But they don’t hate it anymore.”
The YouTube turnaround can also show that complaints are working. The music industry has a fairly successful track record in picking a # 1 public enemy – Pandora for a while, Spotify, YouTube and newer apps like Tick tock and Pull out – and publicly intimidating or pitting one rich company against another in order to get more money or something else they wanted.
YouTube is out of turn, but I don’t know if it’s forever. Mark Mulligan, a music industry analyst and consultant, and my colleague Ben Sisario told me that some of the same old lawsuits are bubbling under the surface. Music power players still believe that YouTube pays far too little per click compared to other digital music services. And they fear YouTube devalues songs everywhere because it doesn’t do enough to stop pirated content.
But maybe YouTube has shown that it is possible for digital companies to both turn an industry upside down and empower it. That is a rarity. Think of the resentments that many news organizations and websites have about Facebook and Google, restaurants’ uncomfortable reliance on grocery delivery apps, and Netflix’s uncomfortable marriages with entertainment companies. Perhaps time and money can achieve some degree of peace.
Before we go …
The ending of “too good to be true”. Uber, DoorDash, and Airbnb have had the money to subsidize the cost of their convenience services for years. Now, writes my colleague Kevin Roose, these young businesses need to make a profit, and this, along with pandemic oddities in the economy, is driving up prices for Ubers, scooters, and Airbnb rentals.
A Look At How The Richest Americans Are Not Like The Rest Of Us: ProPublica got its hands on data on the tax returns of some of America’s richest people, including tech billionaires, and identified those who have used legal means to Paying income taxes that were only a tiny fraction of their growing wealth. For example, Amazon’s Jeff Bezos didn’t pay federal income taxes in 2007 and 2011, and Tesla’s Elon Musk did the same in 2018, reports ProPublica.
It was a trailblazer to make a living online: Wired writes about the legacy of Twitch, the live streaming service that created opportunities for people, through tips and subscriptions, to raise money by doing things online to get recognition and connection. Without Twitch, there would have been no “creator economy” for Substack authors, Instagram influencers or Patreon podcasters, for better or worse.
Happy birthday to the good dogs Charlie and Silas who look adorable in their sparkling crowns.
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