YouTube paid over $4BN to the music industry in the last year
YouTube and Spotify rivalry is coming on the next level after the Alphabet-owned company claimed to pay over $4BN to the music artists or industry. As a reminder, the chief executive of Spotify Daniel Ek announced that they paid out over $5 billion to the music industry in the last year 2020. As the information revealed by YouTube on 2nd June 2021; they had paid over $4BN to the music-related industry. YouTube’s Global Head of Music Lyor Cohen revealed the total payment sent to music artists, songwriters, and copyright owners. Lyor Cohen announced all the news in his blog post. He also announced that the money was derived from YouTube ads, YouTube Music, and YouTube Premium subscriptions. YouTube’s head of Music said the company aims to become the world’s number 1 revenue generator in the music industry.
According to the reports, out of $4 billion, 30 per cent of revenue was generated from user-generated content (UGC): videos uploaded by monetized channels and claimed by rightsholders using the Content ID system. Interestingly, YouTube added more paid members in Q1 of 2021 as compared to any other quarter of the year since its launch, according to Lyor Cohen. Moreover, it means that both YouTube’s premium music content and user-generated content (UGC) are rapidly growing and driving significant value and revenue for the music industry. According to the reports, YouTube approximately paid 4 billion dollars to the music industry in the last 12 months. This means the video streaming app spent almost 20 per cent of the total revenue generated in the last year.
The head of music for YouTube also claimed to have paid $3bn to the music industry in 2019. YouTube also claimed that over half of the revenue paid to the music industry comes from Content ID claims or UGC. Cohen further added that the video streaming giant is continuing to collaborate with “direct-to-fan products” that includes:
- paid digital goods
- paid-for virtual events
However, Cohen did not list updated stats of paid memberships. In October 2020, the paid members on YouTube stood at 30 million globally and additionally five million people on free trials of YouTube Music Premium and YouTube Premium. As more and more users are switching towards YouTube Music for their favourite kinds of music, there’s a chance of the Google-owned video streaming app to gain the number one spot in the music industry. Furthermore, the head of YouTube music also had an eye on the no. 1 spot in the music field.