Indie Labels Begin Court Case Against Youtube

Today sees the battle between indie labels and Google backed internet giant YouTube begin in earnest. As reported in Music Week, formal proceedings have kicked off in Brussels, with a coalition of labels accusing YouTube of breaching European competition rules in their attempts to turn YouTube into a monetised music streaming service.

The Independent Music Companies Association – known as IMPALA claim that YouTube is effectively creating artificial barriers to accessing the digital market.

"Earlier this week, a leaked contract that detailed YouTube’s licensing terms for independent labels, revealed that payments will be made per subscriber or based on a percentage of revenue.

The top rate for audio-only music breaks down to 65.5% of the service’s revenue, with 55% paid to labels and 10% to publishers and performance rights organisations.

Independent companies have reportedly been told their artists’ videos would be blocked if they did not agree to sign up to non-negotiable contracts."

These terms have been described as 'highly unfavourable' by the World Independent Network, whilst Radiohead's Ed O'Brien, who heads similar pressure group The Featured Artists Coalition, castigated the website's plans – "Indie artists and labels are at the cutting edge of the future of music.  To restrict them in this way is to risk creating an internet just for the superstars and big businesses.  Without the innovation and risk-taking of the Indie Sector we lose a vital ingredient in pushing us all forward."

Alison Wenham, CEO of WIN and Chairman of AIM (Association of Independent Music, UK), said “We will start this process in Europe with IMPALA referring YouTube to the EC for urgent regulatory action, which will be the first step in a global campaign.  Our fellow trade associations around the world, representing tens of thousands of independent companies, also take issue with the actions of YouTube towards the most creative sector in the music industry. We must therefore do everything we can to protect the independent sector from the actions of one very powerful company, which seeks to railroad content owners, and by association their artists, into unfair and unjust contracts while threatening to block access to their platform. “

With YouTube becoming so prevelant it has passed into the English language as a verb, the outcome of this court case will inevitably have far reaching consequences for the way underground music is accessed, monetised and promoted.