Independent labels may suffer as YouTube starts new subscription service

Independent labels may suffer as YouTube starts new subscription service

Several music videos by artists signed by independent labels may be taken down by YouTube "in a matter of days," as the company prepares to launch a new subscription service.

YouTube just announced their plans to launch a new subscription service in the coming weeks, and with a number of independent record labels refusing to sign up to the Google-owned company’s licensing terms, several of your favorite music videos may be blocked “in a matter of days.” Robert Kyncl, YouTube’s head of content and business operations stated today that in order to ensure that the content on their new platform will be governed by their new contractual terms, videos by a number of independent artists must be removed from the free version of YouTube.

“I’m not very happy, obviously,” said Rich Bengloff, president of the American Association of Independent Music. “We’re asking to be treated equitably and fairly.”

Fans of Adele, the Arctic Monkeys, and a number of other artists signed to independent labels are also sure to be upset over the change, but YouTube insists that it is necessary to keep users of the test version from becoming confused about which content they can access for free and which features require payment. Also, allowing free streams of music by artists which are not offered them on the paid service would decrease the value of the paid plan. YouTube assures music enthusiasts that record labels representing 95 percent of the music industry have agreed to the new terms, so they’ll still get to listen to a majority of their favorite artists. The three major music labels — Universal Music Group, Sony Music Entertainment, and Warner Music Group – are among the labels which have agreed to the terms.

“While we wish that we had a 100 per cent success rate, we understand that is not likely an achievable goal and therefore it is our responsibility to our users and the industry to launch the enhanced music experience,” said Kyncl in an interview with the Financial Times. Kyncl continued to say that YouTube is offering all rights holders a good deal, stating “We’re paying them fairly and consistently with the industry.”

Ever since it was acquired by Google eight years ago, YouTube has paid out more than $1 billion to the music industry through licensing deals which give rights holders the ability to take a share of its advertising revenues. “That number is going to double soon,” said Kyncl.

For a monthly fee, the new subscription service will allow users to watch videos or listen to music without advertisements on any of their devices, even when they are not connected to the internet.

Google is clearly in a hurry to jump into the fast-growing market for music subscription services, likely due to Amazon launching its own service for Prime subscribers last week, and Apple buying Beats Music last month. Internal testing for YouTube’s subscription-based offering will begin in the coming days, so the company has a chance to polish the user interface and remove any bugs before making it available to the public later this summer.

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