The record label has a contract with the artist. The artist is paid by the label based on sales. When you cheat the artist he/she doesn't get paid.
This poster's comments are pretty old now but just to clarify - the issue isn't someone dancing alone to their music on a video - the issue is youtube, a for profit company making money off of the content uploaded by their users. The video becomes an asset of youtube and is monetized - so the song becomes part of the income generated by youtube (profits). So the music creators are asking to be compensated by youtube.
It isn't about the content of the video, it's how the video becomes an asset of a billion dollar distribution company.
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