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YouTube to Block Indie Artists Who Don’t Sign Up for Subscription Service

Posted by Jim Tanous on June 17, 2014
YouTube Blocked

YouTube is reportedly planning to block independent musicians and labels from its video platform unless they agree to sign up for the company’s upcoming music subscription service, according to a report Tuesday from the Financial Times.

Both independent and mainstream artists frequently use YouTube to publish music videos, with such content amongst the most popular on the service. With the company preparing to launch a paid, ad-free subscription tier, however, artists who don’t agree to terms with the company will soon find their videos scrubbed from YouTube’s properties.

The upcoming YouTube subscription tier will allow users to watch or listen to music videos without ads on any YouTube supported platform, requiring the company to seek new deals with artists to support such a service.

At its core, the negotiation between Google-owned YouTube and record labels is similar to that faced by other companies that have already launched paid or ad-supported online music services, such as Apple, Beats, and, just last week, Amazon. The difference here is the leverage that YouTube appears to be exercising.

When negotiations break down between record labels and, for example, Amazon, the consequences are generally limited to the contract on the table. In the case of Amazon, which wasn’t willing to pay for recently released hit songs, the consequences for the labels amounted to the absence of any song released in the last six months from the streaming service. With YouTube, however, it appears that labels and artists that don’t agree to the company’s terms will see their popular music videos erased from the service.

According to Robert Kyncl, YouTube’s head of content and business operations who spoke to the Financial Times about the issue, major record labels representing 90 percent of the music industry have already agreed to terms with the company. Independent artists, however, including big names like Adele and Arctic Monkeys, have yet to reach a deal, and will possibly see their music videos removed from YouTube “in a matter of days.”

YouTube’s position on the change, Mr. Kyncl explained, is to “ensure that all content on the platform is governed by the new contractual terms.” Sources familiar with the situation speaking with The Verge speculate that the company simply doesn’t want to limit its new paying customers to videos from participating labels only, but at the same time doesn’t want paying customers to see ads if they select a video from a label that hasn’t signed up. With 90-plus percent of artists already enrolled, the company possibly decide that playing hardball and blocking the holdouts was preferable to an inconsistent user experience.

While the exact timing and implications of YouTube’s new policy are unknown, independent artists are protesting the move by seeking intervention from the European Commission. The artists and labels argue that YouTube’s new terms are an abuse of the company’s power and dominant market position, and some even fear that changes to YouTube’s free model alone will force companies like Spotify out of the market.

Absent a change in policy, videos from labels and artists that have not agreed to YouTube’s terms will start being blocked in the next few days. There’s no word yet, however, on when YouTube’s paid subscription tier will launch.

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