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Independent labels hit out at YouTube’s “unnecessary and indefensible” negotiating tactics

By | Published on Friday 23 May 2014

WIN

The Worldwide Independent Network, the body that brings together indie label trade groups from across the globe, has now formally gone public with its criticism of YouTube over the way the Google subsidiary is handling negotiations for its planned audio streaming service.

As much previously reported, YouTube has ambitions to go head-to-head with Spotify et al by launching an audio-based music platform that will sit alongside the video-based music content already sitting on its network. First mooted last year, the planned new music service has taken a while to get off the ground, partly because of growing resentment in the music community over the size of the royalties YouTube currently pays when music videos are played on its site.

But it’s thought that the major music companies are nevertheless close to doing a deal with YouTube for its planned audio streaming service. Which means the Google company has now turned its attention to the independent label sector, but – says WIN – the deal on the table is woeful. Though what has really angered the indies is the alleged threat made by the web giant that if the labels don’t sign up to the all-new YouTube music service, their content will be blocked elsewhere on the video platform.

Indie label trade bodies from across the world planned to go public with their anger over YouTube’s negotiating tactics yesterday morning, but the digital firm stepped in at the last minute requesting talks. But as of last night those talks had seemingly not dealt with the key issues, including the threat to block indies from the wider YouTube network if they don’t play ball, a move WIN describes as “unnecessary and indefensible”.

In a statement late last night WIN said: “We have held extensive talks with YouTube at their instigation over the last 24 hours to try and resolve this issue but no progress has been made. WIN’s request for YouTube to rescind the termination letters sent to its members has not as yet been agreed to”.

Meanwhile Alison Wenham, head of the UK’s indie label group AIM and CEO of WIN, added: “Our members are small businesses who rely on a variety of income streams to invest in new talent. They are being told by one of the largest companies in the world to accept terms that are out of step with the marketplace for streaming”.

She goes on: “This is not a fair way to do business. WIN questions any actions by any organisation that would seek to injure and punish innocent labels and musicians – and their innocent fans – in order to pursue its ambitions. We believe, as such, that these actions are unnecessary and indefensible, not to mention commercially questionable and potentially damaging to YouTube itself, given the harm likely to result from this approach”.

“The international independent music trade associations call upon YouTube on behalf of their members to work with them towards an agreement that is fair and equitable for all independent labels. This has uncomfortable echoes of similar behaviour by MTV ten years ago, who chose initially to take a similar approach in undervaluing the independent sector, but who subsequently concluded a deal on fair terms, which lasts to this day. It is for every company to determine their own commercial arrangements, but it is in no one’s interests to see independent artists being undervalued in the digital marketplace”.

It remains to be seen how YouTube responds, and whether they would go through with their threat of taking indie label artists off their platform in a bid to realise their audio ambitions.



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