Independent Record Labels vs. Youtube: The Fight for Money

Christopher Sabec YoutubeIn a recent article by Billboard Biz, Youtube might “take down” music from independent music labels. This is all in light of Youtube’s recent subscription service launch. If the rates that Youtube is offering are not fully compensated for the paid subscription service then Youtube will not be “supporting” them any longer on Youtube’s ad-supported streaming service. A service that pays hundreds of millions of dollars a year to labels and publishers. Not only will this hurt the independent labels that use the site to promote their artists and videos but Youtube will keep the videos up on the site without backing the label with advertisers.
In order to defend themselves, Youtube will stand by the Digital Millennium Copyright Act and will only take down the music when they are notified by the rights owner. The independent labels either can take down their music or leave their music on the site with no compensation from Youtube. It is a tricky situation. After the service launch, there have been many independent labels complaining about the way Youtube is handling the situation and they are trying to get government regulatory agencies to look at Youtube’s businesses tactics in the way they set up the subscriptions service. However, not all indie labels are upset with Youtube. Other online streaming services, such as Spotify, don’t give labels the option to be on the premium service rather than the ad-supported part of their model. Labels state that Youtube is “going backwards” with their business model. This means that Youtube built and developed the “free” part of their model first and then figured out how to make money by converting the site to an ad-supported model. On the other hand, other streaming services have offered indie labels lower rates than other established labels. Moving forward, hopefully something can be done to help indie labels not have to suffer when big names like Youtube and spotify want to turn a profit on their content.