Interesting story on the BBC today about Youtube pulling all UK music videos from the site in a reaction to the charges being levied by PRS (Performing Rights Society). Now music licencing is a complicated beast but essentially there are “Master rights” and “Publishing rights”, usually held by a record label and a publisher respectively, and both need to be licenced to play or sell music to the consumer. Roughly speaking, PRS handle licensing for UK companies when it comes to visual stuff, while sister company the MCPS handle audio rights.
The problem the music industry has is that too many people want their cut. You have the writer, performer(s), manager, record label, publisher, promoter, distributor and then the licensing organisations all looking to benefit from each “performance” or inclusion of a song on any consumer medium. With the advent of the Internet and music becoming ever more readily accessible, the industry is even more cut-throat than it’s ever been, and quite simply there is a gap between the value of music as perceived by the consumer, and that of the interested parties. This is the crux of the problem here. Youtube knows the value of the music to it’s service is less than the PRS are asking. So bye-bye music videos.
Discussions are “ongoing”, but Youtube has stated that it doesn’t intend to reverse it’s decision. This leaves the music industry with the ball in it’s court. They have to decide if the promotional value of having the music on Youtube makes up for the shortfall in revenue. It’s not a new problem – just on a new medium.
Trouble is, this is a problem that is here to stay. It’s hard to see anyone in the music biz readily agreeing to give up (or significantly reduce) their share to make licensing costs more attractive, so whether there is a way forward remains to be seen. The artists are the ones who can ultimately take control by using the Internet to do their own promotion and selling (via downloads). But again, it’s a highly competitive area so will they want to? Can they, even? Possibly not, but until some of the middle-men are cut out of the loop, there is unlikely to be a solution to the problem IMO.
For now, the only hope is that PRS and Youtube can agree a fee, but I can guarantee that the PRS are the ones who will have to give.