YouTube Has Paid Out $1 Billion to Music Industry In Last Few Years

Tom Pickett, Vice President of Content of YouTube, speaking on a Midem 2014 panel about online video. 

Google Inc. disclosed on Sunday that its YouTube video platform has paid out more than $1 billion to music rights holders "over the last several years," putting the California technology company among the top sources of digital revenue for the embattled music industry outside of download sales.

The statement, made by YouTube VP of content Tom Pickett, came in answer to a question during a panel discussion at Midem in Cannes, France, about how much value Google as a technology platform places on music and whether artists are making meaningful money by being on the platform. YouTube had earlier stated that it has paid "hundreds of millions of dollars" to the music industry.

"We are very much into music," Pickett said, adding later that, "If you think about it, we’ve paid out to the music industry over the last several years over $1 billion. So there is money being generated in this ad-supported model. It is going to artists."

Pickett pointed out that the money YouTube pays out goes to "thousands and thousands" of musicians and rights holders, addressing the complaint that some individual artists may not see large checks because the per-view payment is relatively small.

Jordan Berliant, a panel member and head of music management at The Collective Music Group which represents Linkin Park, Stone Temple Pilots and Staind, added that YouTube "can be a place to make money," but that, "It’s not a place to make money right now." Berliant added that he doesn't blame YouTube, whose business model relies largely on advertising, which in turn relies on having a massive audience.

The session got testy when panelist Geoff Taylor, the chief executive of BPI and the BRIT Awards, referred the revenue his artists receive from YouTube and other ad-supported music streaming services as "pennies and pence," when compared to paid streaming services such as Spotify's premium tier and Deezer. Taylor said he hoped YouTube will develop a "mixed model" that also includes a paid subscription service.

YouTube already has the necessary music licenses to launch a paid subscription music streaming product and is expected to launch its service sometime this year.

Taylor took another shot at Google towards the end of the session, accusing the search giant of doing little to remove links to illegal sites that distribute pirated music or sell software that can be used to record music videos on YouTube, Vevo and elsewhere.

"When you know that stuff is illegal, you surely have got the responsibility to take that knowledge into account and do something with your search rankings, which gives the legal sites a chance to put themselves in front of consumers rather than the pirate sites," Taylor said. "To have a really productive partnership, Google and YouTube need to do more on that."

Pickett was not given a chance to respond during the panel, which can be viewed in its entirety on YouTube.