Google has announced that it has rewarded the music industry with 6,000 million dollars (5,895 million euros) between July 2021 and June 2022 for the use of content published on YouTube. According to the technology giant, this represents 2,000 million more than in the previous period.
The SGAE already collects more with streaming than in hairdressers
It is about the monetization of musical content included in long videos but also in YouTube Shorts, audio tracks or live broadcasts. It comes from content uploaded by record companies but also from content generated by users. The platform has indicated that the percentage of remuneration that rights holders receive from the content that private users create and publish is just over 30%, the same figure that they revealed the previous year.
6,000 million dollars is not the amount that YouTube has earned thanks to music nor does it indicate how much authors have received thanks to the use of their music on the platform. The company does not provide further details except for this rounded figure that is distributed to the rights holders, which can be music publishers or management entities that retain a percentage of the income.
A fragmented industry
Streaming is the current engine of the recorded music industry, but its benefits are much more fragmented than when the record (CD or vinyl) was the centerpiece. In the previous model, the label received direct income. Now, it is the tech giants that are the main winners of this system. The main copyright management company in Spain, SGAE, collected 19.9 million euros in 2021 (27.8% more than the previous year) for on-demand music without downloading, known as streaming.
From the data provided by the SGAE, it is known that in general the authors receive more money from the exploitation of their music on subscription platforms than on those financed by advertising, as is the case with YouTube. Only a small part of the profits finally reaches the authors, since music publishers also receive a percentage (almost all in the hands of the major labels) and rights management companies. The incomes are very disparate and the numbers are unknown. It is known that while the vast majority of authors enter very small amounts, a small number get higher income, depending on private agreements and also on the number of reproductions. The music video with the most views on YouTube corresponds to Despacito, by Luis Fonsi with an appearance by Daddy Yankee, which is about to reach 8,000 million views.
In 2020, 60.8% of digital market revenue was from audio subscriptions and 36.1% from ad-supported music (21.6% audio and 14.5% video). This is because the revenue share (the percentage of profit that goes to the author) is higher when a listener plays a song through a paid service than when he listens to an advertisement first.
YouTube has a paid service (10 euros per month), but it is poorly implemented and most of its income comes from the advertising that is inserted before and during the videos. Again, the company does not give figures but according to the 2021 annual digital audio study report by IAB Spain, only 3% of users who have listened to music through a paid service in 2021 have done so with the YouTube premium option . Even less than the previous year, which was 5%.
According to the latest survey by the Association for Media Research (AIMC), YouTube Music is the third platform chosen by users to listen to music, behind the majority Spotify (80%) and Amazon Music (31%). According to the survey, 23.6% use YouTube Music.