Music labels making 'millions' from YouTube

Nick Clark
Monday 28 February 2011 01:00
Comments

Universal music will be confident about the success of Jessie J's debut album Who You Are which is released today, as she is one of the most viewed artists on YouTube this year with almost 40 million hits on just two of her music videos.

Yet YouTube is no longer just about building a buzz on emerging artists and new albums. The largest labels, including Jessie J's Universal Music Group, are making "millions of dollars a month" from the advertising alongside their videos, a senior executive at the site has revealed. He added that his company's relations had improved with the labels, after the two sides fell out over royalties in 2009.

YouTube has revealed that its music partners, which range from Sony, Warner, Universal and EMI to independents and individual artists, have doubled and in some cases trebled their monthly revenues over this time last year.

Patrick Walker, senior director of content partnerships for YouTube in Europe, Middle East and Africa, said that after a slow start, the labels saw the site as an important revenue stream. "A few years ago the cheques were pretty small," he said. "We laugh about that now." There are currently 3 billion "monetised" video hits a week, 50 per cent higher than in May.

Yet two years ago, YouTube fell out with the music industry after Warner tried to force Google, which owns the video site, to pay more per hit, culminating in the label's videos being removed from the site.

In the UK, it also came into dispute with the royalties collection service PRS, prompting a removal of videos in the country. The two sides reached an agreement in September 2009, which saw thousands of music videos return to the site. "The music industry is getting it. For the most part they are collaborative," Mr Walker said. "People are looking at how to boost revenues more aggressively. The need to go to illegal services is declining with sites like ours and Spotify."

YouTube believes this is only the start and expects to expand through more industry partnerships, new countries and a general rise in traffic. Mr Walker added that new devices including tablets and the rise of video views on smartphones, would boost revenues.

Warner had been the first to sign a deal with YouTube, in 2006, before the other majors signed up. The group has since forged ties with a number of independent labels such as Domino Records. There are now 2 billion views on YouTube a day, up 50 per cent from 2009, with 35 hours worth of video uploaded every minute.

Lady Gaga became the first-ever artist to reach 1 billion views on YouTube in October last year. She has since been joined in the "billionaire's club" by Shakira and Eminem. Justin Bieber, who has also hit 1 billion views, first found fame through the site.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Please enter a valid email
Please enter a valid email
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Please enter your first name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
Please enter your last name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
You must be over 18 years old to register
You must be over 18 years old to register
Opt-out-policy
You can opt-out at any time by signing in to your account to manage your preferences. Each email has a link to unsubscribe.

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in