“YouTube for YouTube” @midem: @davidclowery and @theblakemorgan Review “YouTube For Artists”

In a crescendo of antagonism starting with the Sony Pictures hack that leaked confidential documents demonstrating that the film studios have had it with Google, Google’s lawsuit against a state attorney general seeking to stop his investigation of Google’s bad behavior and the leak by somebody of the Spotify agreement with Sony Music, the New York Post reports that YouTube (Google’s wholly-owned subsidiary) is going to the MIDEM conference this week for the purpose of attacking the record company/artist relationship.

I find this to be particularly bizarre given that Google has also formed a massive coalition fighting against artist rights in league with familiar faces like Pandora, the National Association of Broadcasters, the Digital Media Association (DiMA), the Computer and Communications Industry Association (CCIA), the Consumer Electronics Association (CEA) and a host of others.  After doing that, YouTube’s attack on labels at MIDEM is triangulation of the first water particularly because I think that YouTube is simply a data profiling honeypot disguised as a video service.

So here is the question:  Is “YouTube for Artists” masking Google’s massive failure to innovate?

I asked two working artists and artist rights advocates Blake Morgan and David Lowery what they thought about YouTube’s campaign.  Each answered the following questions.  Today I will post David’s answers with Blake’s coming tomorrow (Blake had shows over the weekend don’t you know).

1.  The New York Post has a recent story that YouTube is directing their billions against “record labels”:

“YouTube’s ambitious initiative to grow its influence in the music business — and lessen the power of record labels at the same time — is about to meet its first big test….The huge initiative from the video streamer could cut music labels out of a huge piece of their business, insiders said…. “We’re going to disrupt the music labels,” YouTube executives said during these briefings, sources said.”

Two questions: First, why do you think that YouTube wants to attack record labels?

David: YouTube is a Monopsony. This is to strengthen their monopsony. We don’t really have collective bargaining as artists [with YouTube]. The closest thing to collective bargaining is to have our catalogues represented by large independents and major labels. In the absence of anti-competition action by the DOJ to rein in Google’s predatory and aggressive tactics, artists will never get a fair deal individually.   This is classic Google. Just look at Google books case.   Google fought a class action so that authors were forced to sue Google individually.   How are individual authors or performers ever gonna get a fair deal going one on one against one of the largest corporations on the planet?

Why would YouTube think that that they can replace labels and if they did would that be good for artists?

David: If they want to replace labels they would have to put up capital for marketing, promotion, recording and tour support.   That’s why artists sign record deals. Not because they prefer old line media corporations over Silicon Valley tech companies.   Want to help artists and go into business with artists? Put your money where your mouth is. Look at Netflix and Amazon, they figured it out. And they are kicking YouTube’s ass. They are stealing Hollywood talent by paying for the creation of exclusive content. It’s actually sort of sad how YouTube doesn’t even understand their own product or market. They could have been the dominant player in high quality content video streaming. They really snatched defeat from the jaws of victory on that one.

So if they don’t understand their own business, they really don’t understand the music business.

2.  Apparently “YouTube for Artists includes providing direct marketing intelligence to artists that will help them better connect with their fans”. This is apparently data from YouTube, which means you have to be on YouTube to get it. Given Taylor Swift’s success with using blocking techniques to essentially “window” how much do artists being on YouTube benefit artists compared to benefiting YouTube?

David: I doubt this is a good deal. To get that “intelligence” from Google you would have to sign their usurious licensing agreement. Remember Billy Bragg said something to the effect that if artists were upset about Spotify rates he thought they should be marching on YouTube with torches and pitchforks. YouTube pays the worst rates of all the on demand services. So to get that “intelligence” you end up competing against your spins from higher paying services.

Sometimes I just want throw my hands up in the air, let the artists and labels that believe this stuff fall for it.   If you believe this BS you deserve what you get. But that’s not really fair is it?

3.  Assuming there’s a value in being on YouTube, how much does “direct marketing intelligence” from a free service like YouTube relate to artists who eventually have to sell something to somebody?

David: Does that mean we can directly contact people that watched our videos? Cause that’s the best way to sell tickets and music. If so aren’t there privacy concerns here?   I doubt that Google wants another privacy lawsuit on their hands. So let’s assume that it’s something less than that.  So what is this data? I can already see where my fans are concentrated from FaceBook, Twitter and our own email list. I can look at the traffic to our website and get a very granular view of where our fans are located. Data is the new snake oil.

The most laughable thing in the New York Post article is that somehow the buyer for a even a small music venue is gonna book a band based on noisy data from YouTube views.   My wife books hundreds of concerts a year. From local acts that draw 50 people to international superstars. I’m imagining her reaction if you tried to book a gig with her by discussing YouTube intelligence. Even for her smallest venue she’s got to risk a minimum $750 dollars to open the doors. Not to mention opportunity costs. Maybe if you have a very recent million views on YouTube, you’ll probably get a gig, but if there is no Pollstar data (a subscription service that compiles data on artist ticket sales), at best you’re gonna get a percentage of gross. All the risk carried by the artist.

This one little tidbit tells me that whoever is pushing this YouTube market intelligence knows nothing about the concert business.   If no one at the MIDEM conference questions the YouTube folks on this bogus claim, MIDEM should just just admit it’s a waste of time and close its doors.

4.  The Post says that:

“YouTube will offer ‘promotional programs to help’ fledgling artists “get discovered and grow.” The video streamer’s effort in the music industry also includes the YouTube Music Awards.

Aside from the fact that “get discovered” usually means “by a record company” that YouTube is trying to displace, let’s just assume that “get discovered” in this case means “find an audience”.

Two questions: First, does YouTube actually help artists find a new audience that will engage with the artist outside of the YouTube platform? Given that YouTube skews young and given that most venues for “fledgling artists” are bars with age limitations based on the drinking age, how meaningful can YouTube really be in developing an engaged local audience?

David: Exactly. Again YouTube doesn’t understand the concert business. Concert promoters don’t’ make money on ticket sales. They make money on beer and liquor sales and parking. Two revenue sources that are rather thin from a younger demo. For this reason entry level small all age performance spaces are rarer than unicorns. The economics don’t work. The ones I know of are generally non-profits or “grown-up” venues that offer Sunday all ages matinees.

5.  The YouTube Video Awards have had a mixed success but have largely traded on at least some established stars that became successful without YouTube. Unlike the “Grammy bounce” or the “SNL bounce” we’ve seen no YouTube Awards bounce in sales. Do you think that independent artists are competing to be on the YouTube Awards?

David: YouTube awards are totally oriented towards already established major label artists or independents that have distribution deals with major labels. You are being generous, I don’t know what the journalist is going on about. This is an easily verifiable fact.   But yeah sure there are fledgling pop oriented artists that break through YouTube. Many are covering pop hits, or alternative rock hits from the 90’s (ahem).   I haven’t seen YouTube produce any ground breaking indie rock artists.   They still break by touring.   Their YouTube activity follows, doesn’t lead their touring activity. TV still produces the biggest bounce on YouTube.   You can look this up. Take an SNL appearance, then compare it to the Next Big Sound social metrics for YouTube views and Wikipedia page views.   BTW a spike in Wikipedia page views –aside from Shazam data— is the most reliable indicator of new discovery.

6.  You can’t really speak of YouTube without also talking about its support of brand sponsored piracy and serving advertising against sex tourist videos. Do you think that YouTube has an obligation to clean up their advertising operation if they want to engage with artists?

David: Can you imagine if MTV in the 1980s showed and sold advertising against Neo-Nazi rock videos and ISIS training videos? You think REM and Public Enemy would have showed up for the MTV music awards?   Artists have a highly developed sense of social justice, they don’t want to do business with sleazy people.   YouTube is a cesspool. If artists were aware of how they make their money they wouldn’t do business with these folks.

Personally I’m tired of YouTube hiding behind it’s users. They are serving advertising on user generated content that they have to know is infringing.   If they don’t then how good can their data be?

7.  According to the Post, “The YouTube for Artists project is being managed by TJay Fowler, a former Beats Music product-management executive, sources said.” I don’t know that name, do either of you? Or what we did to offend him?

David: Never heard of him. But Beats has never properly licensed my song catalogue yet they continue to make it available. If I had anyone from Beats over to my house for dinner I’d definitely count the silverware after they left.

I have no idea how Apple got snookered on that deal. I guess it just really proves Steve Jobs is dead.

8.  Let’s take the Post’s list of features for YouTube’s attack on record labels and maybe you guys can comment on your views of the value of each of them.

“YouTube is telling artists that the data it is willing to share can ‘help you get a song added to radio by showing a programmer how big your local fan base is.’”

David: Uh really? They said that? See there’s this company called iHeartMedia and they own like a kajillion stations and their stations are programmed nationally…Who exactly is gonna take that phone call from a fledgling artist with some YouTube data?

But locally I like a local community LPFM station? The DJ is gonna play music according to his or her taste not YouTube data.

I suppose you could find a few independently owned stations, usually in tertiary markets that might take your phone call or answer your email. Can you build following on airplay in Crested Butte CO and Sandpoint ID, maybe.

“Analytics showing the biggest concentrations of fans across the world to help plan tour dates.”

David: See my previous comment. But buyers will literally laugh you out the door with your YouTube data. But seriously you can’t book a national tour without even a small time agent. His or her ability to get you gigs is based on his relationship with the concert buyer and their trust that the agent is providing them an act that not only is good but also will show up and draw people . A buyer does not have time to respond to the thousands of bands with a video on YouTube. Remember you can buy YouTube views on sites like Fivver.   Again a stunning display of ignorance of the concert business by YouTube. Where do they find these people to hire? Craigslist?

“Fan funding buttons for bands to gain the money they need to produce music and videos.”

David: Oh I’m sure this would never be abused! And YouTube would police this SO well, because they already police their site so well. Look at all the unlicensed UGC on the site, I’m sure you’d end up with some low life putting up fan funding buttons for artist they have nothing to do with and pocketing the money.

“Help locating fans’ concert videos and use of artists’ music in user-generated content.”

David: This is funny.   So YouTube can police the content on their site? I thought they couldn’t and it wasn’t their problem that their users were uploading our music without permission? And WE needed to notify THEM. Which is it? They can police the site? Or they can’t?

9.  It seems to me that the Post (and possibly YouTube) are using terms without an understanding of how the music business actually works. “Added” to radio, for example, implies added to a station’s playlist. If a band is based in Austin, just to pick a city, how much does it mean to them that they have some fans in Paris or Taipai? Or even Chicago? I’ve yet to meet the program director or local talent buyer who really wants to know what your YouTube views are because most of them don’t trust it at all or don’t trust it enough to give you a Friday night. Is that just me, am I being too harsh?

David: No you are absolutely right. You would think Rupert Murdoch could afford to hire a journalist who covered the music business that knew something about the music business. For that matter you’d think a 300 billion dollar company like Google could do the same.   However, as pure propaganda piece directed at the MIDEM music conference this is brilliant in some ways.   There are so many idiots in the music business these days I’m sure they will swallow it hook line and sinker.