YouTube streaming is making it hard for artists to earn a living, BPI figures show

Ad-supported streaming platforms, of which YouTube is the main one, contributed only 4% or £24.4 million of total UK record industry revenues

British music exports increased in 2015, with Adele, Coldplay, One Direction, Ed Sheeran and Sam Smith among the British artists accounting for half of the global top ten best selling albums

YouTube earns UK artists even less than vinyl sales, according to the latest figures from the British Phonographic Industry.

Geoff Taylor, BPI and BRIT Awards chief executive, said that YouTube was grabbing the value of music for itself by abusing royalties contracts, making it difficult for artists to earning a living.

"The long-term consequences of this will be serious, reducing investment in new music, making it difficult for most artists to earn a living," Taylor said.

Music consumption in 2015 increased 12.9 per cent including streaming of music videos, BPI numbers show, but income from sales and streaming fell 0.9 per cent to £688 million.

Ad-supported streaming platforms, of which YouTube is the main one, contributed only 4 per cent, or £24.4 million, of total UK record industry revenues even though they have grown 88 per cent year-on-year to make up a fifth of all streamed music.

"UK fans streamed almost twice as many music videos as the year before; tens of billions more views. Yet artists and labels did not benefit from the increased demand for what they created. This is wrong. Music is precious – it’s not a commodity to be strip-mined for big data," Taylor said.

YouTube was valued at $80 billion by a Bank of America Merrill Lynch analyst last year – more than Starbucks, Yahoo and eBay combined.

YouTube says that its rights management system, Content ID, means it pays out for music that might previously have fallen victim to piracy and enables revenue from an audience that has never before paid for music.

Revenue from Content ID represents half of what YouTube pays out annually.

“Claims that the DMCA safe harbours are responsible for a 'value gap' for music on YouTube are simply false," a YouTube spokesperson said.

"As more advertising money comes online, this will grow to match consumption. Comparisons to other audio-only, subscription music services are apples to oranges.”

But as long as YouTube remains the go-to platform for music streaming, paid-for subscriptions like the one offered by Spotify, will be a harder sell to listeners, even though they generate more revenue for artists.

Spotify and other audio streams increased by 82 per cent in 2015, leading to a 69 per cent rise in revenues.

Meanwhile vinyl, once considered to be a dying format, earned the record industry £25.1 million - more than YouTube and all other ad-support video streaming services combined.

The BPI, which represents the British recorded music business, also released data showing that British music exports increased in 2015, with Adele, Coldplay, One Direction, Ed Sheeran and Sam Smith among the British artists accounting for half of the global top ten best selling albums.

Global top 10 albums of 2015

1. Adele - 25

2. Ed Sheeran - X

3. Taylor Swift - 1989

4. Justin Bieber - Purpose

5. Sam Smith - In the Lonely Hour

6. One Direction - Made in the AM

7. Various Artists - Fifty Shades of Grey

8. Coldplay - A Head Full of Dreams

9. Meghan Trainor - Title

10. The Weeknd - Beauty Behind the Madness