Another day, another dispute between indie labels and a streaming service. The latest furore has emerged after several news outlets reported on a leaked YouTube contract – Digital Music News has now published the document in full.
The argument is a complex one, with some pundits casting it as an over-reaction on the part of indies that should be grateful for the exposure, and others criticising YouTube and Google’s heavy-handed approach as well as its obfuscatory terms.
Several issues have been raised around the contract, which has been sent out ahead of YouTube’s planned launch of a subscription-based streaming service it hopes will compete with the likes of Spotify.
It is offering slightly lower rates than its rivals, but that isn’t the main concern. Ultimately, the complaints centre around a lack of choice and a lack of balance.
A so-called ‘negative most-favoured-nation clause’ means that if majors such as Universal agree to a lower revenue rate further down the line – in exchange for an advance payment, or similar – indies will be railroaded into accepting the same percentage, without the benefits and without the profit margins to cover such a change.
Similarly, YouTube is not going to allow ‘windowing’ – the process whereby popular independent artists such as Adele put their music up for sale on iTunes or another platform before releasing it to streaming services, in order to enhance sales.
This also leads into concerns that the contract could make artists and labels put their full catalogue on to the new YouTube subscriber service, instead of picking and choosing certain albums as they do with other interactive streaming platforms; again, there’s a lack of choice available and a certain heavy-handedness in the organisation’s approach.
Finally, the suggestion that those who do not sign up could be removed from the current ad-revenue stream (although free to put their videos up as public users, of cou) has raised hackles. Many indies already feel that YouTube’s model of only putting ads on certain videos (and even then, only doing this in certain regions) means they lose out on potential income.
By refusing to negotiate with the Merlin network and instead dealing with labels on an individual basis, YouTube has set out its stall; similarly, the companies that have refused to sign up are planning to discuss the contract with regulatory bodies in the US and with the European Commission on the continent.
The debate is likely to go on and on as indie labels adjust to the ‘new normal’ and the age of streaming. But could smaller-scale music producers look for an alternative to the monolithic, autocratic approach of YouTube?
At Clowdy, we believe in giving artists and labels choices, both in terms of what content they upload and how they choose to monetise it.
For beleaguered independent producers, this could be a major opportunity – after all, there are alternatives to Youtube.