METALLICA‘s co-manager Peter Mensch is one of a number of music industry players who have commented on the growing fight between record labels and YouTube, calling on the Google-owned video site to hand over more revenue to rights holders.
“YouTube, they’re the devil,” he told a BBC Radio 4 documentary on the music business. “We don’t get paid at all.”
Despite the fact that YouTube has an estimated 900 million users, it generates roughly $680 million (€600 million) a year for the music industry, according to Andrus Ansip, Vice President for the Digital Single Market on the EU Commission. This is significantly less than the $1.8 billion (€1.6 billion) Spotify contributes a year from about 30 million paying subscribers.
“If someone doesn’t do something about YouTube, we’re screwed,” Mensch, a co-owner of Q Prime, a talent management company that has also handled the careers of such artists as RED HOT CHILI PEPPERS, AC/DC and LED ZEPPELIN‘s Jimmy Page, said. “It’s over. Someone turn off the lights.”
Responding to Mensch‘s comments, YouTube CEO Robert Kynci argued that artists were not seeing higher YouTube payouts because of the agreements they had with their record labels.
“It really depends on what is the flow of the money from us to you,” he said.
“The artists who are signed up directly with YouTube are seeing great returns,” he said. “Not everybody — but if you’re generating a lot of viewership, you’re making a lot of money.
“There are middle-men — whether it’s collection societies, publishers or labels — and what they do is they give advances and they want those recouped. So it’s really hard when there’s no transparency for the artist.
“The people who don’t have visibility are generally the ones who tend to be less happy. If you don’t have full visibility, you’re somehow more susceptible to negative thinking.”
YouTube said in a statement that the site “has paid out over $3 billion to the music industry — and that number is growing significantly year on year.”
The statement continued: “Only about 20% of people are historically willing to pay for music. YouTube is helping artists and labels monetize the remaining 80% that weren’t previously monetized. The global advertising market is worth $200 billion. This is a tremendous opportunity.”
METALLICA drummer Lars Ulrich said last year that streaming services were the future of the music industry — although he also admitted that they are more effective for established acts than new ones. Speaking with the BBC, Ulrich said: “I believe streaming is good for music. People sit there and go, ‘I’m not getting paid very much’ — but streaming is a choice on all fronts.”
He added: “Streaming probably does benefit artists with higher profiles. A lot of playlists that are being made available for people seem to feature higher-profile artists… There’s less and less and less and less money being put into younger artists. And there’s a danger of younger artists coming close to extinction.”
But Ulrich also argued that streaming or any other music delivery service won’t accomplish anything if the music itself isn’t up to par, explaining: “I connect less because there’s less great new music to connect with. A lot of the stuff is just regurgitated — this year’s flavor. It’s not leading-edge like THE BEATLES, Miles Davis or Jimi Hendrix.”
Ulrich did not indicate what steps METALLICA will take when it comes to delivering its new album.