Published May 23, 2014YouTube hasn't been making many friends in the independent music world as of late. The company recently incurred the wrath of Beggars Group boss Martin Mills for being a consequence-free source of unlicensed music, and now YouTube is clashing with independent labels over the contracts surrounding its planned streaming service.
A press release from the Canadian Independent Music Association notes that the members of the Worldwide Independent Network (WIN) have been threatened to be blocked from YouTube if they don't sign on for the company's streaming service. The contracts for this streaming service are apparently non-negotiable and offer rates below existing marketplace standards (from services like Spotify and Rdio).
In other words, WIN alleges that YouTube is low-balling indie labels, and if these labels don't sign what they see as unfair template contracts, YouTube will block their content.
WIN boss Alison Wenham said in a statement, "Our members are small businesses who rely on a variety of income streams to invest in new talent. They are being told by one of the largest companies in the world to accept terms that are out of step with the marketplace for streaming. This is not a fair way to do business. WIN questions any actions by any organization that would seek to injure and punish innocent labels and musicians — and their innocent fans— in order to pursue its ambitions."
Wenham has called for YouTube to strike a fair deal with indie labels. Meanwhile, YouTube has apparently already reached deals with major labels Universal, Sony and Warner.
In a statement, Canadian Independent Music Association president Stuart Johnston added, "The independent sector has struggled for decades to have a fair market in which to work. There is no reason for us to, at this point, give to one player privileges that could jeopardize the market health as a whole. This pressure over the labels is insane and will lead nowhere, but to a delay in service launch."
It's a bad sign for artists if YouTube is offering streaming rates below the marketplace standard; after all, many musicians have already criticized Spotify, saying that they receive extremely low royalties for streaming.