People all over the world have for years turned to YouTube as one of their primary ways of consuming music online, which has presented difficult challenges when it comes to monetizing content and compensating the artists. Now, we may be a little closer to resolving that issue.
According to Bloomberg, the Google-owned video site is entering into long-term contracts with two major music labels, Universal Music Group and Sony Music Entertainment. The result should involve stronger policing of copyright laws, which in turn should make it easier for music video owners to bring in revenue.
These new deals will establish standardized rates for royalties that are paid out to the producers of professional music videos and other popular user-uploaded clips. Bloomberg speculated that this may even pave the way for YouTube and the labels to team up on a new paid subscription music service, thus monetizing content even further.
There is clearly a market for subscription music streaming, as Spotify and Apple Music have been lauded in recent years for their role in the music business’ resurgence. U.S. music sales increased by 15 percent in the first half of this year, according to the Recording Industry Association of America.
Universal chairman Lucian Grainge spoke with Variety about the new deal, and while he didn’t explicitly say a new streaming service was coming, he hinted at big possibilities for YouTube’s music content in the future.
“This important step forward provides our recording artists and songwriters [with] improved content flexibility and growing compensation from YouTube’s ad-supported and paid-subscription tiers while also furthering YouTube’s commitment to manage music rights on its platform,” Grainge said.
While YouTube is one of the world’s most popular channels for listening to music, the site and its parent company Google have been criticized for their lax approach to enforcing copyright laws and their insufficient compensation of the artists producing the music. After years of tense negotiations, these new record label contracts are a sign of real reconciliation between YouTube and the music industry.