YouTube Says it Paid the Music Industry More Than $3 Billion Last Year

YouTube says it paid the music industry more than $3 billion last year. "YouTube offers twin engines for revenue with advertising and subscribers, paying out more than $3 billion to the music industry last year from ads and subscriptions," YouTube CEO Susan Wojcicki wrote in a blog post Friday. From a report: The latest figure hints at how much of the Alphabet-owned company's ad revenue goes back to music industry and creators. The data has been largely unknown to investors who have wondered how much money the company is actually pocketing at the end of the day.

Context?

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$3B out of $300B in profit? $3B out of $3.1B?

Is $3B a lot? Not a lot? For example "As of January 2019, Spotify reports that it pays out between $0.00331 and $0.00437 per stream to rights holders. ... Spotify pays out 70% of its revenue to the master and publishing owners."

This sounds like a pat yourself on the back press release without any actual meat to the content.

Re:

[Solandri]

I know it's passe not to read TFA. But it's right there in TFA.

YouTube ads generated $15.15 billion in revenue in fiscal 2019,

The only profit numbers I was able to find for YouTube say $3 billion profit in 2019. (paywalled [wsj.com]). If you guesstimate that music accounts for half of their payouts to uploaders, that would break down to $3b in profit, $3b to music companies, $3b to other uploaders, and $6.15b operating expense. With the last two being uncertain but their sum being known. Like you, I had assumed

Re:

[rtb61]

You be like crazy insane man. How would a store last, if it's profit was higher than the cost of the product. I worked in construction, the profit was down around 5% to 10%, I could not imagine building construction with a profit higher than what they paid out to all the contractors and suppliers. For you to think those margins are low, means your greed is showing. Yeah 10% profit is reasonable beyond that is unreasonable and indicates competition is broken in that market.

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[DrMrLordX]

Huh? 40% profit margin is pretty common in retail. Intel bakes in a 60% profit margin on a lot of its consumer-level products (server gear can go higher).

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[hcs_$reboot]

You seem to be complaining. Youtube is 1) free 2) technically amazing 3) entertaining (esp. with an ad blocker), and am happy with that.

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[AHuxley]

Doing what is legal is now news worthy optics for an ad brand.

How charming

[astrofurter]

Nazis paying big bucks to mafia.... delightful.

Re: climate change ACCELERATING

[astrofurter]

Sorry, my friend. You must not have not the memo. "OMG climate change is gonna kill us all!!" was least week's panic-o-the week. This week we're doing "OMG Mexican beer virus is gonna kill us all!!" Please update your bots, and do try to keep up next time.

The music industry wants double

[nospam007]

Or triple.

Re:

[Joce640k]

And not a single cent will end up in the hands of the artists, because "fees".

Is it profitable?

[NateFromMich]

Do that many people actually watch ads on YouTube to cover the cost of streaming those songs/videos?
Is it just advertising companies are dumb enough to send them billions anyway?

Re:Is it profitable?

[DontBeAMoran]

More importantly, how much is the music industry giving back to the artists? You know, the ones actually producing anything? Do they even pay them at all?

https://www.businessinsider.co... [businessinsider.com]

https://www.techdirt.com/artic... [techdirt.com]

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[Afell001]

That was one of the things that came out of David Bowie's bio. He made a lot of money as an artist. He made most of his money as a producer for himself and other artists, though. So the real money in entertainment isn't as the entertainer, but rather as the person who organizes everything for the entertainer to perform. David Bowie saw this right away and made sure he was that person, especially if he was the artist.

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[JaredOfEuropa]

That's right
Old-fashioned dad says: "be a doctor or a lawyer", or he laments the fact that you could have been one. Modern dad says: be a manager. Good dad says: follow your heart, be a scientist. But smart dad says: Be a middle-man. Don't bank on your own brains but make a living off the brains of others, by peddling their talent. Works for music as well as for engineering, I guess. I know a few people who dropped out of the consulting / engineer gig and started being an intermediary between consult

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[AHuxley]

The US gov pays for ads too?

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[tlhIngan]

Do that many people actually watch ads on YouTube to cover the cost of streaming those songs/videos?
Is it just advertising companies are dumb enough to send them billions anyway?

Apparently so.

YouTube has all sorts of analytics, and part of that includes how many people watch the ads. It can vary, but it's around 10-25% of viewers do watch the ads. We know this because even when a video is monetized, not all views pay money - every time you click "skip ad" it's marked as a non-paying ad and no one gets paid.

The Important Question

[Vandil X]

When I play a YouTube video of 10 hours of Enterprise D Engine Idle as white noise to fall asleep to, does Paramount/CBS get a check?

Re:

[swillden]

When I play a YouTube video of 10 hours of Enterprise D Engine Idle as white noise to fall asleep to, does Paramount/CBS get a check?

How many ads play during that video?

You have to wonder what the payout is

[bobstreo]

for people who use youtube-dl?

RIAA's total revenue is about $11 billion

[Solandri]

$5.4 billion for the first half of 2019 [riaa.com] (they don't have 2nd half stats out yet). 80% of that ($4.32b, about $8.6b if you extrapolate out for the year although it's probably higher due to the holidays in the 2nd half) is from streaming. So it would seem YouTube accounts for a little less than half their streaming revenue?

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[moronoxyd]

I would assume the $3 billion are world wide. The RIAA is only operating in the USA. So they only got part of those $3 billion. Even though I would assume they got more than 50%.

In other news..

[TechyImmigrant]

The music industry paid artists $3.50 last year, but subtracted some expenses so only really paid $2.

Re:

[JaredOfEuropa]

They didn't actually pay anything, that $2 went towards the musicians' debt to the companies (costs incurred in production, promotion, management fees, lawyer fees for licenses, collection from services and stations, retail stock write-offs, covfefe, oh hey what's that over there?)

Re:

[TechyImmigrant]

FWIW, I'm still burning through the advance for my book.
I'm wondering if this year I will get paid.

How much of that is actual theft?

[Anonymous Coward]

The industry cartels regularly file infringement claims over works which they either do not own or are covered by fair use exemptions. The subsequent diversion of ad revenue is essentially direct theft, and smaller channels on youtube typically do not have the resources to contest it. Even if you are in the right, you risk your channel being suspended or lost, and potentially being dragged into court.

Getty images also does this, over works that they harvested from the public domain. Many copyrighted works a

it was expected

[eduardoperez34]

YouTube is the main source of promotion for artists today, when releasing a new single, the first thing they do to upload it to YouTube, it is clear that little by little it would become very influential in this area. eduardoperez [cinecalidad.plus]