What Will A YouTube Streaming Offer Mean For The Music Biz?

Will YouTube use its powers for good or evil with the launch of a music streaming service? Angie Ngie of Newgroup Marketing finds out.

YouTube’s controversial marketing practice of forcing record labels to join their new music-streaming service has received enormous backlash from the music industry. The question is, what could have possibly caused YouTube to carry out such drastic measures despite their pre-established popularity as a video streaming website?

Despite the idea that artists have a love–hate relationship with music streaming platforms due to the minimal amount of pay received per stream, such services remain highly popular among a large proportion of music fans and marketers. With Spotify on the rise, Beats Music gaining publicity on The Ellen Show, and Samsung’s interest in Deezer, everyone wants a piece of the market share pie. Since so many people are trying to get into the music-streaming business quickly, it’s no wonder that YouTube might feel threatened. As a result, it probably led them to think they had to get a huge piece of the pie, and gobble it up as quickly as possible.

Perhaps they lacked the confidence to establish themselves in a market where more and more powerful corporations would be competing against each other. After all, the size of an organisation like Google, who owns YouTube, is by no means an indicator of their ability to secure a great market share whenever they want to. For example, Google Plus remains unstable three years after it was first introduced to the social media world. Then, outside of YouTube, there’s also the abysmal MySpace case study. After paying bags of money to famous spokespersons as part of their efforts to create a musical image, MySpace still failed.

Sure, it is threatening to see so many competitors in the music-streaming market pie. However, that doesn’t mean that YouTube can illegally abuse their power. In fact, whether or not they have ‘power’ with their market share can be questioned, and can change, very quickly. If YouTube does nothing to repair the reputational damage they have inflicted upon themselves, their plans for their music-streaming service could fail in their own hands.

In an information era where everyone is bombarded by copious amounts of information, including music, the main problems that artists face is getting attention. More specifically, many artists want attention that would allow them to get acknowledged or paid for the wonderful work that they do to enrich the lives of others through art. Denying artists the ability to spread the world with a powerful marketing tool such as YouTube basically makes it even harder for artists to share their music to the world, and denies music fans access to music hidden in various corners of the world.

If YouTube had the objective of making a strong presence in the music-streaming market, they were using the wrong strategy. Instead of asking “how music creators could be forced into using Youtube’s new music-streaming platform”, or asking “how YouTube can create conditions for artists and record labels to use their music streaming service in a way that benefits YouTube”, they could have asked this: “How can YouTube create favourable conditions for artist and record labels to use their music-streaming service in a way that would also benefit YouTube?” This is not just a simple matter of rephrasing, and it’s different to the last two statements. In fact, the word ‘favourable’ entails respect and support that YouTube must extend to the music industry in the product development process.

To create something favourable for the music industry and YouTube at the same time, a process of two-way communication needs to take place. YouTube needs to communicate, understand and work with the music industry on negotiable terms. After all, the music industry is a major supporter of YouTube. Without the music industry, YouTube’s latest venture will be less likely to succeed.

Angie Ngie is a member of the communications team at Newgroup Marketing.

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