YouTube Exec Addresses Criticism on Music Royalty Payment Rates

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YouTube pays a fair and appropriate amount for royalties from streaming music in the U.S., even if many will beg to disagree.

Royalty calculations for musical artists and record labels have been more contentious in recent years. This is due to the rise of digital streaming channels and other online facilities. For this reason, YouTube has been the subject of criticism from the Recording Industry Association of America and other groups over payment issues.

Royalty Payments

YouTube Exec Lyor Cohen understands the sentiment of most critics. He also used to complain that YouTube does not pay enough money for ad-supported streams versus Spotify or Pandora. However, YouTube’s $3 payment for every thousand music streams in the U.S. is apparently more than other ad-supported streaming services, he said.

YouTube reaches different markets worldwide. As such, there is a misconception that it should offer higher royalties to U.S. artists. On the contrary, Cohen asserted that lower contributions in emerging markets affect streaming numbers.

Repairing Relationships

For the last eight months, Cohen has sought to fix a somehow broken relationship with the U.S. music industry. He suggested that members of the music industry should determine how much they make while YouTube figures out a better way to pay artists.

In December 2016, the company reached a deal with the National Music Publishers Association. The agreement reportedly involved $30 million of unpaid royalties. More recently, the video-streaming service also agreed with the American Society of Composers, Authors, and Publishers. This is to promote better transparency regarding payments.

Conclusion

Royalty payments serve as another revenue source for recording outfits and music artists. That is why any individual or group should be aware on how to negotiate payment rates. Do you agree that YouTube pays the right amount for its music streaming service?