YouTube patted themselves on the back this month in a blog post that announces a sum of $4 billion paid to the music industry in the last year. This is a pretty vague statement in itself. This article will go over where the money came from, what YouTube is planning next, and how this could affect you.
The author of the article is one Lyor Cohen, YouTube’s Global Head of Music. He’s worth $75 million, for the record.
“When my mom asks me what I do,” he mentions, “I tell her I’m helping to make sure the next Kurt Cobain doesn’t have to become a dentist.”
As I was reading about his self-proclaimed love for the music industry, I wasn’t immediately enthralled. YouTube is not as “perfect” as he says it is. In fact, the platform has arguably been in decline since 2015 due to a demonetization epidemic.
Pictured left to right, Clement Marfo, Lyor Cohen, Mark Strippel, and Michael Owusu Addo (Sarkodie) via @clementmarfo on Instagram
$4 Million in Revenue
The money itself comes from a couple things: ad revenue, online performance sales, YouTube Music sales, and subscriptions, mainly. This whopping $4 billion is quite head-spinning. More importantly, 30% of this cash is from user-generated content (UGC).
At the end of the day, UGC will always be the true core of YouTube. This platform didn’t start out as a celebrity outlet. In fact, it failed at doing that. If you grew up on YouTube like I did, you know that the amateur content creators are the heart of what made the website as viral as it was unique.
That said, 30% may not look huge. When you do the math though, this literally means over a billion dollars was made by music-tagged UGC alone. The body of content creators responsible refers to any independent creator or producer in the industry, as well as the vast majority of non-mainstream names. If YouTube’s ambitions are met with adequate success, this can become a proud facet of the American music industry.
The other 70% of the $4 billion therefore comes from the major labels and big name music videos/performances. A big difference, but when hasn’t it been?
YouTube is aiming to become the leading source of revenue in the music industry. Ambitious claims like this one always end up going one of two ways. Nonetheless, only time will show how this boast turns out. In conjunction with the claim, they added a record number of premium advertising partners to their roster in the first quarter of 2021.
Is YouTube Really the Right Option?
There really isn’t anything inherently incorrect or wrong about what Cohen is saying in YouTube’s blog post. Any skepticism about his heartfelt attachment to UGC comes purely from the so-called 2017 Adpocalypse.
Since 2016, YouTube has had trouble managing the sheer quantity of videos on their platform. After some instances of political incorrectness involving bigger content creators around the same time, they began resorting to automating their video flagging policies, or just implementing them downright poorly. You can read much more about that here.
What we see today is something of a shoddy monetization and claims system, where people’s videos have been taken off search queues and ad revenue without much explanation as to why. Many content creators have given up, and others seem to be inexplicably targeted due to unequal enforcement. It is more than likely you have already heard about this if you are a YouTuber or a fan of one.
But what does this really mean for any musician and their following? It’s hard to say, because the issue at hand is not that YouTube targets anyone in particular with demonetization. Of note, these are big issues YouTube hasn’t directly addressed:
- An abusable DMCA system, typically to extort or scam content creators
- Automated, silent and unexplained demonetization of original content
- Imbalanced/inaccurate representation in algorithms and search results
- Tightening on community guidelines regarding sensitive topics (violence, nudity, etc)
All in all, there’s currently no one solution. The best thing you can do as a content creator is to familiarize yourself with YouTube’s music copyright guidelines. The goal is to minimize the chance of a flag/claim on your video being defendable by the third party. Also, never upload content you haven’t properly claimed, so it cannot be stolen from you.
Photo by Aditya Chinchure on Unsplash
The “Visual-Audio Business”
Cohen states in his blog that he has “seen this industry evolve from an audio business, to an audio-visual business, and now… to a visual-audio business.” He is confident that YouTube can lift up the music business by encouraging music videos, live shows and everything in between from every class and sector of music content creators.
What may be regrettable to some is that Cohen is absolutely correct. Other platforms have begun to introduce visuals into their music experiences. Canvases on Spotify or animated album art on Apple Music are just two to name.
When you go to see a live performance, many artists have a projector or lights or something even more flashy. When you combine sight and sound, musical experiences are twice as immersive. One way or another, the visual-audio experience is the future.
So next time you are listening to your favorite artist, see what they decided to put as their “visuals” for the track. Album artwork is already incredibly important as is, but now a musician who knows what’s good for them will get their hands on some creative eye candy for every nook and cranny of their image.
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