I appreciate you've said this earlier in the piece, but wonder if the conclusion merits a reminder: these ads are from a point in time (2007) in a single country (Brazil) - pre-Spotify and iTunes in that market – at what was probably peak industry hysteria about piracy.
A fascinating (and ridiculous) historical document, but strange to use it to draw wider conclusions about the industry in 2015 (which the present tense: "Apparently that message hasn't gotten through, so the industry keeps ramping up the ridiculousness of each campaign" strongly implies you're doing.)
Don't get me wrong, there's plenty of stuff to write about strategies nowadays, from ISP-level blocks to the other kinds of education campaigns rightsholders would like to run. But implying these gory ads represent how labels fight piracy in 2015 seems a bit strange.
Is ContentID an option for music used in videos published by MCNs? I was under the impression that it wasn't - hence past lawsuits from publishers and direct licensing deals with labels.
Fairly sure that if you're an MCN (and Phan owns her own MCN) you're responsible for licensing music, you can't just leave it to ContentID.
Not that this affects whether you think Ultra is right or wrong, but I suspect ContentID may not have been an option.
I'm hearing lots of surprise from lawyers too about the five year licensing term: it's rare to get anything beyond 18 months / 2 years at the moment, if you're a digital service.
Not an example of YouTube being 'evil' ??understandable they'd want to chance it on this kind of point ??but would be surprised if that really is a non-negotiable length.
"Does anyone really expect that the major labels are going to agree to cut rates?"
I think the argument here is that the majors *might* accept lower rates in return for big advance payments (which - this being the music industry's can of worms ??they might also not be obliged to pass on to their artists).
And that may or may not be likely, but this is why indies are angry about that clause. They already suspect YouTube has agreed to pay big upfronts to the majors ($1bn is the figure that's been suggested a couple of times, although it is suspiciously round as figures go).
So say next time the contract is up for renewal, if YouTube were to say to (for example) Universal 'hey, how about we pay you $X upfront and lower the per-stream rates' the latter could then be enforced on indies, without anything upfront.
This is why the indies set up Merlin in the first place: to negotiate collectively and (possibly) get a slice of those advance payments ??which Merlin would then distribute to the indie labels. This is why Merlin has equity in Spotify (an alternative to advances) on behalf of its members.
So that's another reason, I think, why some independents are cross about YouTube sending them contracts directly rather than sorting out a deal through Merlin.
As a quick follow-up, though, I don't know if those claims are correct or not. It's more that it frustrates me that the labels' specific complaints aren't being discussed more.
Some thoughts in response to this story, starting with the fact that it's not the same people that complain about other streaming services.
Many of the indie labels that are angriest at YouTube now have backed streaming from the early days ??including enthusiastically adopting YouTube as a platform rather than bitching about its rates, as larger labels and publishers have done.
This isn't the 'same old' rightsholders at all.
But yes, what their complaints are specifically:
1. That YouTube sent contracts directly to indie labels. They have a licensing agency, Merlin, which negotiates streaming rights on their behalf. It was set up to try to secure rates for indies that were comparable to those of the major labels. YouTube appears to be trying to cut Merlin out of the negotiating process here.
2. That the contracts YouTube is sending to indies are non-negotiable: it's 'sign this or don't sign it'. Which creates problems for some of the terms below, like...
3. That the contract demands global rights. A lot of indies don't have them ??they license to one another around the world, a patchwork of partners and distributors. In many cases, they don't have the rights that YouTube is demanding in the contract.
4. That the contract restricts exclusives off YouTube (iTunes, Spotify, whatever ??labels say that they're being asked to guarantee YouTube will get new music as soon as any other partner gets it. My understanding is that the majors will not have agreed to this ??but they got to negotiate. The indies don't have that luxury.
5. That the contract demands they put their whole catalogue on YouTube, enabled for monetisation. Got an artist who wants to withhold, for whatever reason? A big problem ??but it?s not negotiable.
6. That the dialogue accompanying the contract has included the threat that if they don't sign, their content will be blocked on YouTube. I agree, there are differing interpretations of what 'blocked' means ??some people have suggested it means 'blocked from monetising' rather than 'blocked from YouTube'. Several labels ??who after all, fielded the actual calls in which this information was delivered ??say it was clearly 'blocked from YouTube'.
7. Blocked from monetising is a concern for them too. Labels fear that their official videos will be blocked, and that they'll be blocked from claiming and monetising videos using that music uploaded by fans too. What they?re worried about: Artist X?s official videos are taken down, they can?t claim and monetise fan-uploaded videos featuring Artist X?s music (including full album rips etc); and if, say, they weren?t allowed to use Content ID, they?d have to go back to the days of individual takedowns.
But perhaps the most important point about this whole row:
8. The indie labels are angry about YouTube's deals with the majors: they believe it has paid big upfront advances to the major labels, possibly in exchange for a low per-stream rate (yes, as you say, a constant source of arguments in this industry), and that YouTube is now trying to force indie labels to accept that per-stream rate without any of the advances. And they're also questioning how the major labels will pay those advances through to artists (a whole different can of worms).
So this isn't 'idiot music rightsholders v YouTube'. It's independent labels claiming that major labels have muscled to get big advances out of YouTube that will go straight to their bottom line, then that YouTube has muscled to try to force indie labels to sign up to the streaming rates dictated by the majors' settlement.
Is this right? It would be good to see someone like Techdirt investigating more deeply into all this, as much of the online discussion around this row is surprisingly confident ?YouTube isn?t doing X, it?s actually doing Y? without citing sources for that information.
Techdirt has not posted any stories submitted by creatif.
But these are eight years ago!
I appreciate you've said this earlier in the piece, but wonder if the conclusion merits a reminder: these ads are from a point in time (2007) in a single country (Brazil) - pre-Spotify and iTunes in that market – at what was probably peak industry hysteria about piracy.
A fascinating (and ridiculous) historical document, but strange to use it to draw wider conclusions about the industry in 2015 (which the present tense: "Apparently that message hasn't gotten through, so the industry keeps ramping up the ridiculousness of each campaign" strongly implies you're doing.)
Don't get me wrong, there's plenty of stuff to write about strategies nowadays, from ISP-level blocks to the other kinds of education campaigns rightsholders would like to run. But implying these gory ads represent how labels fight piracy in 2015 seems a bit strange.
I could be wrong but...
Is ContentID an option for music used in videos published by MCNs? I was under the impression that it wasn't - hence past lawsuits from publishers and direct licensing deals with labels.
Fairly sure that if you're an MCN (and Phan owns her own MCN) you're responsible for licensing music, you can't just leave it to ContentID.
Not that this affects whether you think Ultra is right or wrong, but I suspect ContentID may not have been an option.
Another small point
I'm hearing lots of surprise from lawyers too about the five year licensing term: it's rare to get anything beyond 18 months / 2 years at the moment, if you're a digital service.
Not an example of YouTube being 'evil' ??understandable they'd want to chance it on this kind of point ??but would be surprised if that really is a non-negotiable length.
The majors point
"Does anyone really expect that the major labels are going to agree to cut rates?"
I think the argument here is that the majors *might* accept lower rates in return for big advance payments (which - this being the music industry's can of worms ??they might also not be obliged to pass on to their artists).
And that may or may not be likely, but this is why indies are angry about that clause. They already suspect YouTube has agreed to pay big upfronts to the majors ($1bn is the figure that's been suggested a couple of times, although it is suspiciously round as figures go).
So say next time the contract is up for renewal, if YouTube were to say to (for example) Universal 'hey, how about we pay you $X upfront and lower the per-stream rates' the latter could then be enforced on indies, without anything upfront.
This is why the indies set up Merlin in the first place: to negotiate collectively and (possibly) get a slice of those advance payments ??which Merlin would then distribute to the indie labels. This is why Merlin has equity in Spotify (an alternative to advances) on behalf of its members.
So that's another reason, I think, why some independents are cross about YouTube sending them contracts directly rather than sorting out a deal through Merlin.
Re: There's more to it than this
Sorry, that was a bit long!
As a quick follow-up, though, I don't know if those claims are correct or not. It's more that it frustrates me that the labels' specific complaints aren't being discussed more.
There's more to it than this
Some thoughts in response to this story, starting with the fact that it's not the same people that complain about other streaming services.
Many of the indie labels that are angriest at YouTube now have backed streaming from the early days ??including enthusiastically adopting YouTube as a platform rather than bitching about its rates, as larger labels and publishers have done.
This isn't the 'same old' rightsholders at all.
But yes, what their complaints are specifically:
1. That YouTube sent contracts directly to indie labels. They have a licensing agency, Merlin, which negotiates streaming rights on their behalf. It was set up to try to secure rates for indies that were comparable to those of the major labels. YouTube appears to be trying to cut Merlin out of the negotiating process here.
2. That the contracts YouTube is sending to indies are non-negotiable: it's 'sign this or don't sign it'. Which creates problems for some of the terms below, like...
3. That the contract demands global rights. A lot of indies don't have them ??they license to one another around the world, a patchwork of partners and distributors. In many cases, they don't have the rights that YouTube is demanding in the contract.
4. That the contract restricts exclusives off YouTube (iTunes, Spotify, whatever ??labels say that they're being asked to guarantee YouTube will get new music as soon as any other partner gets it. My understanding is that the majors will not have agreed to this ??but they got to negotiate. The indies don't have that luxury.
5. That the contract demands they put their whole catalogue on YouTube, enabled for monetisation. Got an artist who wants to withhold, for whatever reason? A big problem ??but it?s not negotiable.
6. That the dialogue accompanying the contract has included the threat that if they don't sign, their content will be blocked on YouTube. I agree, there are differing interpretations of what 'blocked' means ??some people have suggested it means 'blocked from monetising' rather than 'blocked from YouTube'. Several labels ??who after all, fielded the actual calls in which this information was delivered ??say it was clearly 'blocked from YouTube'.
7. Blocked from monetising is a concern for them too. Labels fear that their official videos will be blocked, and that they'll be blocked from claiming and monetising videos using that music uploaded by fans too. What they?re worried about: Artist X?s official videos are taken down, they can?t claim and monetise fan-uploaded videos featuring Artist X?s music (including full album rips etc); and if, say, they weren?t allowed to use Content ID, they?d have to go back to the days of individual takedowns.
But perhaps the most important point about this whole row:
8. The indie labels are angry about YouTube's deals with the majors: they believe it has paid big upfront advances to the major labels, possibly in exchange for a low per-stream rate (yes, as you say, a constant source of arguments in this industry), and that YouTube is now trying to force indie labels to accept that per-stream rate without any of the advances. And they're also questioning how the major labels will pay those advances through to artists (a whole different can of worms).
So this isn't 'idiot music rightsholders v YouTube'. It's independent labels claiming that major labels have muscled to get big advances out of YouTube that will go straight to their bottom line, then that YouTube has muscled to try to force indie labels to sign up to the streaming rates dictated by the majors' settlement.
Is this right? It would be good to see someone like Techdirt investigating more deeply into all this, as much of the online discussion around this row is surprisingly confident ?YouTube isn?t doing X, it?s actually doing Y? without citing sources for that information.