YouTube Largest Content Licensor in the World / Recorded Music Revenues Up 27% in H1 2021 / Apple Music Adds DJ Mixes via Shazam

Aaron Davis -

YouTube is now the largest content licensor in the world, according to YouTube’s chief business officer Robert Kyncl in an announcement at the Royal Television Society Cambridge Convention. He mentioned that the company’s partner program covers about 2 million creators, paying out $30 billion to them over the past three years.

In the RIAA’s latest mid-year report, recorded music revenues in the US grew 27% in the first half of 2021 over 2020. Paid subscriptions were the strongest contributor to growth, comprising nearly two-thirds of total revenue. Streaming accounted for 84% of all revenues, up 26% year over year, due largely to new licensing deals with companies like Facebook and Peloton.

In a company announcement, Apple Music stated it is streaming DJ mixes on its platform via the use of Shazam technology. Now, all rights holders on a mix can be identified and paid through a system that was developed as a result of Apple Music working with major and independent labels.

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Compiled by Heidi Seo

Exploration Weekly - September 17, 2021

YouTube is “Now the Largest Content Licensor in the World,” Says Exec

Robert Kyncl, YouTube's chief business officer, shared some data and stats about the video streaming company during the Royal Television Society Cambridge Convention, saying it has become a diversified platform after starting with "grainy home videos" and the like. "Now, media companies present about 25 percent of YouTube watch time globally, another 25 percent is music, and 50 percent is YouTube creators," he explained. Second-quarter advertising revenue at YouTube was reported at $7 billion, up 83% from the year-ago period, after $6 billion in the first quarter, up 49%. That doesn’t include subscription revenue generated by YouTube Music and YouTube Premium. The executive also discussed content spending. "When you think about our payouts, we are now the largest content licensor in the world," Kyncl said. He mentioned that YouTube's partner program covers about 2 million creators, with the company paying out $30 billion to them over the past three years.

Recorded Music Revenues Climbed 27% - and Vinyl Sales Skyrocketed 94% - First Half of 2021, Per RIAA

Recorded music revenues in the US grew 27% in the first half of 2021 over 2020, according to the RIAA’s mid-year report. Paid subscriptions continued to be the strongest contributor to growth, comprising nearly two-thirds of total revenue, and more than 80 million paid subscriptions for the first time. Streaming accounted for 84% of all revenues, up 26% year over year to $5.9 billion due largely to new licensing deals with companies like Facebook and digital fitness apps like Peloton. Paid streaming subscription revenue totaled $4.6 billion - also up 26% - and accounted for 78% of overall revenues. Paid subscriptions for on-demand music services grew 13% to a record 82.1 million in the US, up from 72.6 million over the same period in 2020. Vinyl sales skyrocketed 94% to $467 million, although that number was also dramatically skewed by store closures during the pandemic and severely impacted last year’s Record Store Day, which is traditionally the biggest sales day of the year.

Apple Music is Adding More DJ Mixes and Tapping Shazam to Get Artists Paid

Apple Music is bringing DJ mixes to its platform, leveraging Shazam technology. The company announced that it has worked with major and independent labels to develop a system to identify and pay all rights holders on a mix. The new tool allows its streaming service to compensate individual creators in any DJ mix - even artists who recorded and sampled tunes. This is the first time a major streaming service is enabling DJ mixes for streaming while making sure all artists involved are compensated.

Epic v. Apple Antitrust Case Results in Mixed Ruling

A California federal judge handed down a nuanced ruling with respect to how Apple controls its app platform. Apple has escaped the determination that it is a monopolist, but thanks to conduct that a judge finds to be anti-competitive, Apple must now allow developers to tell consumers how to make purchases outside of apps. The lawsuit was brought a year ago by Epic Games upon the Fortnite maker’s attempt to bypass the 30% commission that Apple takes on in-app purchases. Apple fired back by booting Fortnite from its App Store, which then led to litigation. Epic claimed antitrust behavior. Apple responded that Epic had breached the terms of being in the App Store. In today’s ruling, U.S. District Court Judge Yvonne Gonzalez Rogers defines the market as digital mobile gaming transactions and finds that while Apple “enjoys considerable market share of over 55% and extraordinarily high profit margins, these factors alone do not show antitrust conduct.” Epic must pay 30% of all Fortnite revenue it’s collected since August 2020. However, Rogers does find that Apple is engaging in anticompetitive conduct under California’s competition laws.

JioSaavn and Merlin Ink Expanded Global Music Licensing Partnership

Merlin, the global digital rights agency for the world’s independent label sector, has extended and enhanced its existing music licensing partnership with India-based music streaming service, JioSaavn. The deal marks the first renewal between the two parties since regional music streaming service Saavn merged with India’s JioMusic. It will also enable Merlin’s membership to increase their presence in South Asia, and will expand JioSaavn’s catalog offering to its worldwide audience. Accounting for more than 15% of the global digital music market, Merlin members represent tens of thousands of labels and hundreds of thousands of artists from every country in the world.

UMG Prospectus Reveals More Details on Its Revenues Breakdown

In a 306-page prospectus from Universal Music Group (UMG) ahead of its upcoming public listing, UMG revealed that catalog music - which it defines as anything older than three years - accounted for 54% of its recorded music revenues in 2020. Of those overall revenues, 49% came from North America, 30% from Europe, 14% from Asia and 3% from Latin America. Meanwhile: “No single artist accounted for more than 1%, and the top 50 artists only accounted for 23%, of UMG’s recorded music revenue in 2020.” UMG also said that 95% of its digital revenues come from its top 50 digital service partners. There’s also a notable spike in UMG’s spending on “advances to artists and repertoire owners,” which grew from €448 million in 2018 to €653 million in 2019, then €941 million in 2020.

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