YouTube Announces New App for Emerging Markets (That May Rankle the Record Business)

Jenny Tobien/picture-alliance/dpa/AP Images
The YouTube logo photographed on Aug. 9, 2016.

YouTube has announced the launch of a new app aimed at users in developing countries, who often have little-to-no cellular access to the web and spotty wifi, that will make it easier for them to save videos for offline viewing.

"We realized," writes YouTube vp of product management Johanna Wright in a post from this morning, "that for the next generation of YouTube users to fully discover all that YouTube has to offer, we had to reimagine the YouTube mobile app from the ground up."

YouTube says it spent time researching and testing throughout India in order to develop its new app, which gives users the option to save videos for offline in standard or low quality to save disk space on their devices. Another bandwidth-saving feature is the option to preview a video in thumbnail before streaming it in its entirety.

Most notably, though, it lets users send videos to each other over Bluetooth, obviating the need for any web connection in order to share content. In a piece looking at connecting South African townships to the web, Steven Snofsky of leading venture capital firm Andreessen Horowitz's wrote that the first things these users do is YouTube and music. TechCrunch reporter Jon Russell writes today that he often sees "people in Southeast Asia using it as a music library while out and about."

With that in mind, YouTube's new product might not be entirely thrilling for the recording industry, (even though the majority of music on YouTube is there legally).

In a recent post piggybacking on his organization's half-year revenue report, RIAA chairman/CEO Cary Sherman again dogged YouTube for its low contributions to the recording industry's bottom line despite its high ratio of total music streams. (Much less songwriters'.) YouTube has continually pointed to the $3 billion is has paid out to the music industry since launch as proof of its contributions, and stresses that the recording industry is expecting revenues at a scale the site hasn't yet achieved.

YouTube has spent much of this year getting browbeaten by the music industry -- just yesterday, Irving Azoff characterized the company as evil in a conference speech.

While India, and most developing countries and emerging digital markets, has low revenue-per-user (Apple Music costs about $1.80 a month in India, versus $9.99 in the U.S.), the vast number of potential customers presents a clear opportunity for tech and media. And India is just getting started.

With 462.1 million on the web, India is second only to China as the country with the most people connected to the internet. (Compare that to the 286.9 million connected in the U.S.) India also has the lowest penetration -- the percentage of people with web access compared to total population -- out of the ten countries with the most people on the web. (Numbers via Internet Live Stats.) Combined, these two numbers make India one of the most promising emerging markets (arguably behind China, though that country's political climate can be troublesome to new media entrants), and becoming a staple of users at this early stage in the country's digital evolution will yield.

(This is at least part of the reason why Mark Zuckerberg tried so hard to launch Free Basics, an "internet-lite" connectivity initiative formerly known as Internet.org, in the country. That failed, following objections from Indian regulators. Zuckerberg then pivoted to Africa, where there was some trouble up north.)

After last week's news that digital listening, streaming in particular, is driving growth for the U.S. recording industry after many years of contraction, they are no doubt laser-focused on making it as revenue efficient as possible. With the Western world all-but totally connected, they will likely be watching listener behavior in new markets very closely -- and may scoff won't want people trading YouTube videos like mixtapes. (A request for comment on that point from the Recording Industry Association of America wasn't immediately returned.)


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