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News November 19, 2017

Recording industry slams Google’s “positive” YouTube study

Recording industry slams Google’s “positive” YouTube study

Both the International Federation of the Phonographic Industry (IFPI) and the British Phonographic Industry (BPI) have lashed out at a new Google-commissioned report that claims YouTube (which it owns) only has a positive effect on the music industry.

The study, by RRB Economics, titled Value Of YouTube To The Music Industry – Paper One: Cannibalisation, covered 6000 YouTube users in four European territories –Germany, France, Italy and the U.K.

Among its claims were:

  • “Without YouTube, 85% of time spent listening to it would be lost or shifted to lower or similar value channels” as TV, radio or internet radio.
  • Without YouTube, 50% of the time that consumers spend listening to music would be spent on non-music.
  • At least if people accessed YouTube, artists and the music industry would get ad revenue. It estimates this as $1 billion in the 12 months to December 2016.
  • Without YouTube, music consumers would be forced to head to file sharing and piracy. Time spend on listening to pirated content would rise by 29%.
  • Only 15% of “heavy users” (those that watch over 20 hours of music a month) would join a subscription service. That figure is 19% for the UK and 12% in France.
  • In Germany, a huge amount of music content was not available on YouTube until November 2016 because of a lengthy dispute with performing rights society GEMA. After that blocking on YouTube had no effect on a track’s performance on streaming services.

The IFPI rejected the findings as “Google’s latest publicity push” and “once again seeks to distract from the fact that YouTube, essentially the world’s largest on-demand music service, is failing to license music on a fair basis and compensate artists and producers properly, by claiming it is not liable for the music it is making available.”

It says that record companies support the evolution of the digital music business by licensing over 40 million tracks across hundreds of digital services around the world.

As the Global Music Report data just made clear, music fans are increasingly willing to engage with licensed streaming services. However, services like YouTube, that are not licensing music on fair terms, hinder the development of a sustainably healthy digital music market.”

BPI’s Chief Executive Geoff Taylor argued, “RBB’s data shows that nearly a fifth of YouTube usage in the UK would divert onto higher value platforms, such as paid subscription services.

“If that usage were evenly distributed among YouTube’s users and 19% of YouTube users chose to take out a music subscription, it would generate approximately £415 million (A$723.9 million) per annum additional retail spend on music – doubling the current value of the UK streaming market.

“Even if only half this number chose to subscribe, the shift would still make an enormous difference to the UK’s artists, songwriters and labels and to the growth of our digital music sector.”


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