The Big Topic: Will YouTube’s new licensing changes help musicians?
From the very moment YouTube emerged, the streaming platform has endured a complex relationship with the music industry. In 2009, the video-sharing platform blocked most music videos in the United Kingdom due to a dispute with the Performing Rights Society (PRS). Now, they’ve announced a new programme that allows artists to monetise their site even further, but artists should be cautious before celebrating the development.
The dispute was resolved, and YouTube ultimately held the cards. Google, which owns YouTube, claimed every time a music video was played on the site, they lost money because of the considerable royalties they had to pay to PRS. After a six-month battle, both parties finally reached an agreement which saw PRS receive an advance and the promise of future royalty payments.
Music channels on television had died by this point, and artists had little choice but to succumb to YouTube’s demands if they wanted their creations to find an audience. Over the last 13 years, the platform has established itself as the place to view (almost) every music video ever created, and they are now taking its relationship with artists to that next step.
This week, Christopher Muller, VP of Music Licensing at YouTube, has announced a new platform, Creator Music. It will allow creators to access a catalogue of licensed, popular music, which they will be legally permitted to use in their videos with the revenue split between all benefactors.
Muller explained: “It’s been difficult for creators to license music. It’s complex, it takes time, and it takes them away from the creativity that they put into their craft.” Muller claims that Creator Music “is good for the music industry because we have two million creators [in the YouTube partner program], and that’s going to open up a new audience to artists and to songwriters, and some of these audiences are super engaged.”
YouTube has struck a deal with over 50 labels, publishers, and distributors, including Believe, Downtown and Empire. “Several hundred thousand tracks” are now available to creators. Interestingly, they are yet to secure permission from any major label, but Muller is optimistic this will change.
The most obvious winner in this deal, of course, is YouTube. It improves the level of content by having creators use genuinely popular music rather than irritating license-free sounds and creates a new revenue stream for the platform. The inner-cynic inside me believes that YouTube is not doing this to help artists or generate more money for themselves. However, when musicians’ pockets are especially depleted due to the cost of living crisis, causing touring to become even more expensive, and Spotify’s profiteering methods, Creator Music could alleviate some of the financial pressures.
Music rights holders can charge up-front for a license, in which case the video’s creator is entitled to all of the revenue, bar YouTube’s 45% cut. Alternatively, they can enter a revenue-share model, where the creators receive 27.5%, and the music rights holders take the other 27.5%.
The majority of prices currently range from free to $4.99 for licensing. Therefore, theoretically, Mr Beast, who has over 100 million subscribers, could use an artist’s song in a video, and they only get $4.99. However, they would also likely see a significant uptake in streams and interest in their music, leading to more revenue. Furthermore, creators with any considerable following will opt to pay a flat fee exclusively for licensed music rather than unnecessarily shave off 27.5% of revenue.
Tracy Maddux, Chief Commercial Officer for Downtown Music Holdings, believes it will “help our songwriters and recording artists find new, meaningful revenue streams for their work, as well as to make it possible for all YouTube creators to legally license and discover original music for use at scale.”
This licensing change could allow songs to trend on YouTube similarly to TikTok, and it could be hugely beneficial to artists who may even have chart success thanks to the platform. However, in all likelihood, Creator Music won’t give the music industry a facelift and provide a consistent revenue stream for musicians. A select few will win the lottery by getting unfathomably wealthy from viral success. Yet, for the many, it’ll be another inconsistent cheque recieved through the post sporadically, like Spotify, which they can’t rely on to pay their bills. Again, musicians have drawn the short straw, and YouTube is the victor.
