Update: A YouTube spokesperson responded to us with the following statement: The overwhelming majority of labels and publishers have licensing agreements in place with YouTube to leave fan videos up on the platform and earn revenue from them. Today the revenue from fan uploaded content accounts for roughly 50 percent of the music industry’s YouTube revenue. Any assertion that this content is largely unlicensed is false. To date, we have paid out over $3 billion to the music industry – and that number is growing year on year.
Personally, I find YouTube’s business to be very disingenuous. It is built on the backs of free, stolen content and that’s how they got that big. I think any free-tiered service is not fair. It’s making their numbers and getting them a big IPO and it is built on the back of my work and that of my peers. That’s how I feel about it. Strongly.
Reznor made the comments in an interview alongside Apple SVP Eddy Cue, VP Robert Kondrk and ‘no official job title’ Jimmy Iovine in which the three discussed the lessons they have learned through launching the streaming music service …
Reznor said that the desire to do more than complain about free music was why he joined Apple.
I’ve dedicated my whole life to this craft, which, for a variety of reasons, is one that people feel we don’t need to pay for anymore. And I went through a period of pointing fingers and being the grumpy, old, get-off-my-lawn guy. But then you realize, let’s adapt and figure out how to make this better instead of just complain about it.
Eddy Cue said that making Beats 1 radio shows available on demand had been a priority, and Iovine said that there’s a lot more content on the way, including video.
Content and Media Apps VP Robert Kondrk said that the team have been learning how to create an integrated offering across radio, on-demand streaming and downloads.
The teams have learned how to work together, so Beats 1 is almost the tip of the arrow. Zane will introduce something, and then it goes into Apple Music, and it goes into iTunes and all the promotion we do across our whole music ecosystem, and you end up with a result like we had with Drake. It’s all stitched together now.
Cue and Reznor both said that they didn’t see streaming completely taking over from downloads anytime soon, though Cue acknowledged that downloads are declining.
Cue: Downloads weren’t growing, and certainly are not going to grow again, but it’s not declining anywhere near as fast as any of them predicted or thought it would. There are a lot of people who download music and are happy with it and they’re not moving towards subscriptions. We talked about subscriptions bringing a lot of new customers in, people who have never bought music. And if you look at Apple’s music revenue on a quarterly basis, because of subscriptions and because of sales, it’s now higher; it’s actually growing, which is great for the labels.
Reznor: It feels as though we’ve turned a corner in terms of the adoption of streaming. I think it’s inevitable that downloads will diminish, much like CDs. But I’ve started buying vinyl — probably out of nostalgia, but also there’s something about a physical thing that has meaning to me as an artist. I think coexistence can take place.
Cue said that Steve Jobs’ understanding of the entertainment business through Pixar, and Apple’s ability to marry content and technology, has been one of the reasons Apple had been so successful in that space.
Technology companies have disrespected the content creation process and the content creation people disrespect technology. Both think, “How hard [could it be]?” The truth is, and I understand this really well, is that both of them are artists when it comes down to it. A programmer starts with a blank screen, no different than starting a song with a blank sheet of paper.
The whole interview is worth a read.