London
07 December 2016
Reporter: Barney Dixon

YouTube’s $1 billion not a reason to celebrate, says IFPI


The International Federation of the Phonographic Industry (IFPI) has poured scorn on YouTube’s claim that it the $1 billion it had paid to the music industry over the past year is sufficient.

In a blog post on 6 December, YouTube claimed that it had paid the sum from advertising alone, “demonstrating that multiple experiences and models are succeeding alongside each other”.

“Even as music subscriptions have been growing faster than any other subscription type, advertising is another powerful driver of revenue.”

But IFPI said that this figure was “unexplained” and gives “little reason to celebrate”.

It said: “With 800 million music users worldwide, YouTube is generating revenues of just over $1 per user for the entire year.”

“This pales in comparison to the revenue generated by other services, ranging from Apple to Deezer to Spotify. For example, in 2015 Spotify alone paid record labels some $2 billion, equivalent to an estimated $18 per user.”

IFPI argued that YouTube, despite being the world’s largest on-demand music service, is not paying artists and producers a fair rate for their music.

“This highlights more than ever the need for legislative action to address the ‘value gap’ that is denying music rights holders a fair return for their work.”

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