A large number of independent labels are voicing concerns over the newly planned audio service from Youtube (who are owned by Google) which will place them head-to-head with other music streaming services such as Spotify, Rdio and Deezer. The new audio streaming service which will sit alongside their current video service seems a lot closer to going ahead with rumours of an agreement with the larger record labels (Sony, Warner and Universal) being very close. They are now turning their attention to the smaller independent labels which has led World Independent Network (WIN) to issue a statement of concern on behalf of its members.
WIN which represents independent record labels around the globe, which boasts the second largest global market share after Universal, have issued a statement about their concerns over the way agreement is being sought by Youtube over the new service which reportedly includes the threat of blocking the content of members who do not sign up to the new music streaming agreement. They described the threat as ‘unnecessary and indefensible’. Here’s an extract from WIN’s recent update:
At a time when independent music companies are increasing their global market share WIN has raised major concerns about YouTube’s recent policy of approaching independent labels directly with a template contract and an explicit threat that their content will be blocked on the platform if it is not signed.
According to WIN members, the contracts currently on offer to independent labels from YouTube are on highly unfavourable, and non-negotiable terms, and undervalue existing rates in the marketplace from existing music streaming partners such as Spotify, Rdio, Deezer and others.
WIN has held extensive talks with YouTube at their instigation over the last 24 hours to try and resolve this issue but no progress has been made. WIN’s request for YouTube to rescind the termination letters sent to its members has not as yet been agreed to.
Alison Wenham, CEO of WIN and Chairman of AIM (Association of Independent Music, UK) said, “Our members are small businesses who rely on a variety of income streams to invest in new talent. They are being told by one of the largest companies in the world to accept terms that are out of step with the marketplace for streaming. This is not a fair way to do business.WIN questions any actions by any organization that would seek to injure and punish innocent labels and musicians — and their innocent fans— in order to pursue its ambitions. We believe, as such, that these actions are unnecessary and indefensible, not to mention commercially questionable and potentially damaging to YouTube itself, given the harm likely to result from this approach. The international independent music trade associations call upon YouTube on behalf of their members to work with them towards an agreement that is fair and equitable for all independent labels. This has uncomfortable echoes of similar behaviour by MTV ten years ago, who chose initially to take a similar approach in undervaluing the independent sector, but who subsequently concluded a deal on fair terms, which lasts to this day. It is for every company to determine their own commercial arrangements, but it is in no one’s interests to see independent artists being undervalued in the digital marketplace.”