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Why Warner Did a Deal With YouTube

No Comments 10 May 2017

Why Warner Did a Deal With YouTube

On Friday evening, MBW broke the news that Warner Music Group had signed a renewed global licensing deal with YouTube – via an oddly downtrodden internal memo from WMG boss Steve Cooper.

“[Our] experiences during these negotiations were proof positive of the acute need to clarify ‘safe harbor’ provisions under US and EU copyright legislation,” it read.

“That’s the only way to conclusively close the gap between the revenue YouTube generates and what songwriters, artists, publishers and labels make in return.”

For what ultimately amounted to the announcement of a contract extension, this was a missive dripping with barely-concealed sufferance.

Author: Tim Ingham MBW

YouTube, of course, is public enemy No.1 for the music business right now… Warner included.

The ‘value gap’ between consumption on the platform versus the amount it pays out to rights-holders is driving labels to despair – exacerbated by a damaging lack of control caused by ‘safe harbor’ laws.

Here’s a quick illustration of the extent of the issue.

YouTube says its Content ID system resolves 99.5% of all sound-related copyright issues on its platform.

That’s a 0.5% margin for error. Let’s say it’s true and accurate.

An estimated 500 hours of content are uploaded to YouTube every minute. That’s 720,000 hours each day.

0.5% of 720,000 hours is 3,600 hours of video. So that’s what you can pretty much expect Content ID to miss… every day.

Bear in mind it takes just one three-minute video to stay available on YouTube to savage record company release plans.

As Cooper put it: “[Our] fight to further improve compensation and control for our songwriters and artists continues to be hindered by the leverage that ‘safe harbor’ laws provide YouTube and other user-uploaded services.”

In other words, if you’re not on YouTube… you’re still on Youtube. You’re just not getting paid.

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