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The Emporer’s YouTube Monopoly Has No Clothes

May 1, 2014

I can’t say that YouTube is a total waste.  No, YouTube has found a way into our culture, in no small part due to Google’s monopoly over search that extended horizontally to the video search vertical in YouTube.  That horizontal monopoly was subsidized by monopoly rents from text based search.  But the benefits are not to be underestimated, and I, too, must confess to learning things on YouTube that I would otherwise have completely missed.

I mean, tell the truth: did you know that they are taking the Hobbits to Isengard?  Who knew?  How on God’s green earth did we ever endure our darkness without YouTube.

But when it comes to paying royalties for songwriters and recording artists, not to mention record companies and music publishers, you have to take into account a few facts that are not disputed (or at least not disputed by any person capable of sequential thought).

1.  Artists Abhor Advertising:  Generally speaking, artists hate, detest, loathe the entire concept of advertising.  Speaking more specifically, there is a group that hates advertising as long as it’s not a product they like that costs a couple bucks.  So for example, you could probably get Sting to do a Jaguar commercial rather than one for Marmite–even if the Marmite commercials paid vastly more sums of money.  ‘

So if you hate advertising, you’re going to despise Google.

2.  Meet the New Boss, Far, Far Worse Than the Old Boss:  In the new boss environment, artists are being told that if they decide they don’t like Google Play with Your Bollacks, the artist has to pull out of every music service.  Really?  What if the artist only HATES GOOGLE?  There is no record company on earth stupid enough to try to make this deal with little or no money up front.  Far, far, far, far, far, far, far worse than the old fellas.  And anyway, isn’t this an illegal exclusive dealing contract?

3.  Cheap is Not a Look for Slumlords Being Burned Out of their Houses:  Ok, they haven’t been burned out of their houses yet, but…they…will…be…don’t be surprised.  Don’t rent from a Googler in the Mission, and if you do your musical insurance better be paid up.

Just tell the house warming party from Occupy Bidets that you toil in the antebellum economy of Google Play aka the Genco Pura Olive Oil Company 2.0.

And here’s the point–not only should we admire Charles Caldas of our UK brothers at Merlin for having the balls to tell it like it is with YouTube, but Charles should also be admired for not rolling over and embracing the New Boss 2.0 like so many quislings have done.  Here’s the other point though that further supports Charles’ complaint.  Google rips us off all the live long day, drives traffic to pirate sites selling the recordings that our marketing efforts get captured by Google’s search platform.  Because Google is the paymaster of the Internet, one way or another Google is involved.  There’s probably a cut out in between so Don Google is not seen handing money to the wrong person, but somewhere there’s a bookkeeper with a ledger and they know who got paid what.

So in YouTube negotiations its important to remember that we start below zero due to Google’s profit from theft–we start negative.  So whatever the rate is that YouTube isn’t paying, it’s actually worse than you think because of the piracy.

Charles deserves our support and he’s damn well earned it.  You should read the entire article, but especially this line:

Caldas chose not to name YouTube directly – “I tend to get myself in trouble when I talk about that company” – but instead quoted from an interview given by musician Billy Bragg earlier in the year, in which he responded to criticism of streaming music service Spotify by artists by saying “if we’re pissed off at Spotify, we should be marching to YouTube central with flaming pitchforks”.

“I can’t say Billy’s right, but I can say that he’s not wrong,” Caldas told the audience at Music Connected, the annual conference organised by the UK’s Association of Independent Music (AIM) for indie labels and distributors.

I’ll say this:  It’s mystifying how YouTube is anything but a way to capture a benefit from everyone advertising and promotional spend, at which point not only should they be paying a royalty, they should be underwriting the artist and record company’s marketing that drives traffic to them.

Bravo to Charles for putting a finger in the eye.  We have a lot of horror stories about YouTube–starting with how they are screwing new MCNs by refusing to give them music publishing reporting data.  And it’s great to see our leaders standing up to Google’s juggernaut,




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