YouTube, created in 2005, is currently the biggest video streaming platform to date since six billion of hours of video are watched every month approximately. It’s a place where people upload tutorials, reviews, music, comedy and a lot of other types of content each minute.
How does this platform relate to digital music?
Most artists and bands use it to put their official and lyric videos for their new singles. In addition, there are many people that have started their music career through uploading song cover on the platform. Therefore, YouTube has been and still is an important site for this industry. The reason for its popularity is that it is extremely easy to use and there’s a lot of content to choose from, which gives us, the audience, freedom to decide what we want to watch and when. Not only that but the content consumers don’t have to pay for it, which makes us think: how do the people who work at YouTube or the video creators make money from it?
The way the platform is monetized is through the YouTube Partner Programme, which was created in 2007 and operates in 60 different countries, and ever since the videos uploaded to the website can be monetized through Google Ads that can be skippable or fixed, the number of views, product placement or any kind of partnership between a brand and a creator. A lot of small businesses use it because it is really fast and easy way to reach your target audience. The problem with this type of monetisation is that people don’t want to watch them and use apps like AdBlock that block all the ads which leads to no money being made. One thing that may change in the near future is that it is a very probable that it will turn into a monthly paid subscription service. YouTube Red is a service that has already launched in the United States that tries to solve the problems YouTube as a free platform may have. It works with a paid subscription and it is ad-free and you can watch videos offline like you can with the paid subscription on Spotify and it is also launching exclusive content and original series like Netflix has done with Orange is the new black or Stranger Things.
At this moment YouTube is doing great and growing every second, therefore it doesn’t seem to be even near its end as a video streaming service. On the other hand when it comes to music there are other platforms like Spotify that are gaining popularity day by day. This may result in YouTube not growing in the music streaming service direction but in an all type of on-demand video streaming way. It is probable that YouTube is not the future of digital music but it has definitely changed it upside down these past few years and these changes have shaped up what the music industry is right now.
What is more important to you access or ownership?
We are transitioning between owning the music we want to listen to having access at any time to every single kind of music via platforms like Spotify. But this change isn’t exclusive to music, Netflix is another access service that is growing in popularity day by day and making people switch from ownership to access.
We have found that we can get music very easily and fast as long as we have a smartphone with us at that moment, we can access anything we want to listen to at any moment. We are not tied to the albums we have bought or the singles we have downloaded, because of sites like Spotify or iTunes we can choose what we feel like listening and even discover some artists on the go. That is something that we couldn’t do before because we owned specific things but we didn’t have access to everything. This has had an impact not only on the way we access music but on our music consumption patterns and on how artists and everyone involved in the making of a song gets paid.
When we buy music nowadays it is very likely that it’s due to the exclusivity of the product, like a different version that is unavailable in the streaming platforms. If it weren’t for that, most people would just stream it instead of buying it.
Streaming and subscription services look like the future of the entertainment industry and of all the other ones that would be able to work with this type of business model.
There are a lot of digital distributors and label services that help artists release their new music in all the different online music platforms. In this post I will be talking about a few of those: TuneCore, Absolute and Zimbalam.
TuneCore is a digital distributor. The artist take all the revenue they make and they make money through an annual subscription: for an album it’s £19.99 the first year and £39.99 the following, for a single £5.99 and for a ringtone £13.99. They also offer music publishing administration for the fee of £49.99. The artist can also access to daily sales trend reports with iTunes, Spotify and Amazon Music data, monthly sales reports and costum cover art if they want it.
Absolute is a label service company that all takes care of the distribution and marketing, helping the exposure of the artist’s music. They take a distribution fee for their service. A downside of Absolute is that it ca be too expensive for artist who are not making a lot of money from their music, but it helps with the exposure of the music which is what every new band or artists is looking for.
Zimbalam is a digital music distributor. They charge £19.99 for a single and £29.99 for an album. The artists collects 90% of the royalties, they offer access to detailed sales reportings, daily statistics and analysis tools. They also offer tools so that their clients are able to do their own promotion.
TuneCore has the advantage of the artist getting all the revenue they make and only paying an annual subscription fee, but if they are starting out and don’t get that many sales they might end up losing money since TuneCore doesn’t offer any kind of service to help the artist’s music exposed. Zimbalam helps artist a bit more than TuneCore promotion wise and Absolute definetely focus on the promotion, which I think is important because you can have your music on all the platforms but it’s not really worth it if nobody is going to discover it. That’s why I would say that the label service Absolute is a great service to help artist get their music discovered and distributed, on the other hand TuneCore and Zimbalam could be good for artists that already have people who listen and buy their music.
Welcome to my blog,
I am a Music Business student and in this blog I’ll be discussing some key issues and topics about the music industry, from digital distribution to relevant platforms that change this industry every week.
Hope you enjoy it.