[Shooti]

Plausible breakdown of Google/YT's side of the story:

1. Youtube wants to offer users a subscription service with no ads.

2. Youtube needs to update its licensing/terms with artists: If a video plays for a subscriber they see no ads, artist gets money from subscription pool. If a video plays for a non-subscriber they see ads, artist gets money from ads pool.

3. Artists need to explicitly agree to these terms because it changes how and how much they'll get paid.

4. It doesn't seem fair for a user to pay a subscription, expect to see no ads, and then see ads for some video's because that artist/distributor did not agree to new terms. This is why Google wants all or nothing.

[hullo]

Taking all that at face value it certainly disregards the actual user, who in the vast majority of cases will not be subscribing to this new service. It sounds like Google+ all over again; where Google is spiting the vast majority of its users (removing content that they wish to see) in order to launch a (likely to fail) service that directly replicates one or more services already widely available.

[spacemanmatt]

No, it doesn't affect the non-subscribing users. They will see ads either way. It is the artists and the subscribers who would be adversely affected by artists that do not participate.

[allochthon]

It is the artists ... who would be adversely affected by artists that do not participate.

Adverse affects for independent artists who do not sign up translate to adverse affects for non-subscribers that want to watch those artists on YouTube.

[btian]

Also subscribers who want to watch those artists. It's a lose-lose-lose situation.

[spacemanmatt]

Isn't that what I said?

[dublinben]

YouTube's new service will be an audio streaming service, not a video streaming service though. I'm not sure why they think they can just make a slight modification to their licensing agreements and roll their video catalog into a music catalog.

The record labels are completely right to be demanding better terms here, just like they would get from Apple, Spotify, Pandora, etc.

[Shooti]

Not sure you can draw such a hard line between audio/video since all the rumors point to this subscription service essentially being both:

http://www.androidpolice.com/2013/11/27/apk-teardown-youtube...

i.e. By enabling the Android/iOS Youtube app to background (which they've gone out of their way to disable up until this point), it essentially becomes an audio streaming service with the same interface.

Plus according to the FT, the problem the indie labels have isn't with the subscription rate per se, its how the new ad tier is set up:

"One label boss said the big problem with YouTube’s new licensing agreement was not to do with the paid tier, but rather that it allowed YouTube to make substantial enhancements to its free tier. His fear is that YouTube’s free tier will become so attractive that it will reduce the number of people willing to pay for subscription services such as Spotify or Deezer."

[fpgeek]

That sounds like a fundamental disagreement about how much video-wrapped audio streaming is worth (with Google saying enough people will pay to avoid the extra overhead/complexity and the labels thinking that people will walk many miles to save a few bucks). That sounds like a plausible place for negotiations to break down.

I suspect Google is right today (at least for the many people who care about mobile music, since the data and/or storage costs would be prohibitive now), but I can also see how a label might not want to set too generous a precedent for tomorrow (on the assumption that bandwidth and storage might become abundant enough sooner than they're comfortable with).

[peroo]

A lot of people are already using YouTube as a free streaming service, and even though artist can monetize their music, the payout is significantly lower than from pure music streaming services. This is seen as a fair tradeoff seeing as YouTube is also a great promotional channel, but Google are now trying to pivot it into a pure streaming service without significantly changing payouts.

It sets a very dangerous precedent for the value of music, which can be incredibly damaging for already struggling indie artists (not so much for the three majors who have received _massive_ advances)

[fpgeek]

How does that make any sense? The only YouTube subscription worth paying for is one that gets you out of YouTube ads (and, ideally, unlocks videos that are currently desktop-only on mobile devices, TVs, etc.). Perhaps they'd throw in audio streaming as a sweetener, but if videos aren't deeply involved they might as well just give Google Play Music All Access the needed rebranding, not re-negotiate anything and call it a day.

[IanCal]

I wonder if they'd combine play music and subscription youtube, music videos are one of the few real advantages they have over something like spotify.

[ryanwhitney]

>> "It doesn't seem fair for a user to pay a subscription, expect to see no ads, and then see ads for some video's because that artist/distributor did not agree to new terms."

Why not? Make it clear on signup that it's a premium service with guaranteed quality content, and x number of major labels are on board where you won't be seeing ads.

If there's actual value to users (and artists--their brands won't be associated with random ads) in something like this, there should be enough pressure to encourage these indie labels to agree to terms and go ad-free, no?

[IanCal]

"Fewer adverts" doesn't quite have quite the same draw as "No adverts!".