The search engine Google has been accused of doing evil to independent music labels by forcing them to sign up for its streaming music subscription service.
The service has not officially been announced and will compete directly with Spotify, Deezer and their rivals.
But Google is using its control of YouTube to force indie labels to sign up to the new service according to the music industry trade association the Worldwide Independent Network (WIN).
YouTube is approaching labels directly with a “template contract” and threatening that if they do not sign it, all their music videos will be blocked on YouTube.
It also claims the terms of the contract are non-negotiable, and undervalue the music of these labels in comparison to Spotify, Rdio, Deezer and other subscription streaming services.
WIN had a press release saying that all planned when planned to issue a press release lambasting YouTube this morning, with quotes from YouTube opened new talks. However the press release was released to AFP under embargo and WIN forgot to retract it.
WIN chief executive Alison Wenham said in the original release that the small labels are 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.
“We believe, as such, that these actions are unnecessary and indefensible, not to mention commercially questionable and potentially damaging to YouTube itself, given the harm likely to result from this approach.”
Sending contracts directly to independent labels would be a controversial move; many are members of another trade body, Merlin, which negotiates collective licensing deals with new digital music services on their behalf.
Merlin chief executive Charles Caldas recently criticised YouTube in a speech at industry conference Music Connected, referring to a quote from musician Billy Bragg suggesting artists who criticise Spotify for its low royalty payments “should be marching to YouTube central with flaming pitchforks”.
Caldas said YouTube pays the least but is the service that is the most well-funded and run by the biggest company in the world. Their figures are by far the worst, whether you measure them on a per-stream basis or a per-user basis.
WIN is concerned is over the “termination” letters that it says have been sent to labels, threatening to block their content on YouTube if they do not sign up to the new service. WIN has now given YouTube a 24-hour deadline to rescind those letters.