In the context of music streaming services and fair royalty payments, YouTube commonly emerges in public dialogue as the de facto “worst” of the streaming giants (https://thetrichordist.com/2014/01/16/while-artists-are-bitching-about-spotify-royalties-google-youtube-and-grooveshark-are-in-the-getaway-car/ ). Yet, new findings by TuneCore will likely alter this widespread public perception. According to a new report, the amount of royalties paid to artists with sound recordings on YouTube increased 370% from 2014 to 2015. Based on this data, the report asserts that artists with a sound recording on YouTube make $100 more, on average, than artists whose music is not on the platform.
More interesting is the reason behind this sudden explosion in royalty payments – advertisements. Unlike other streaming services, YouTube , at least on claimed channels, (http://www.tunecore.com/blog/2014/12/find-youtube-composition-royalties-get-money.html), pays a greater royalty per stream if YouTube places an advertisement on the artist’s video. Individually, this increase in royalty revenue might seem small, but the data shows it clearly adds up.
Recently, artists have pushed streaming services for more exclusivity to increase the “fairness” of their royalty compensation, many seeking to only have their work available to premium, ad-free accounts. There are even reports that Spotify is exploring the concept of “premium-only” tracks. (http://www.ubergizmo.com/2015/12/spotify-considering-premium-only-tracks-rumor/). However, if TuneCore’s report teaches us anything, it is the lesson that perhaps ad-supported streaming is not the inherent “bad guy” after all. Based on the data, if done right, ad-supported streaming could, at least attempt to, provide recording artists with an equitable financial return.
Read more about the story here: http://www.digitalmusicnews.com/2016/02/15/youtube-is-growing-at-a-ridiculous-rate/
Jennifer Marr is an Entertainment and Sports Highlight Contributor for the Harvard Journal of Sports and Entertainment Law and a current first year student at Harvard Law School (Class of 2018).