Music Is YouTube's Most Profitable Category, 'Crucial' to Bottom Line: Study

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Music and music-related videos make up 20% of all views on the platform, despite representing only about 5% of all videos uploaded.

Music videos generate the highest return-on-investment for YouTube despite making up a relatively small percentage of all videos uploaded, according to a new analysis by the global video and music search engine and analytics platform Pex. The study concludes that music is “crucial” to the video-sharing platform’s profits, despite representing only about 5% of all videos uploaded. 

The analysis breaks up YouTube's video content into a number of popular categories, including "gaming" (by far the fastest-growing category), "people and blogs," "entertainment" and "film and animation." Of those categories, roughly 35% of videos uploaded to the platform fall into “people and blogs" and just over 30% fall into “gaming." 

While music (or music-related) videos make up a much smaller percentage, Pex found that they racked up a collective 1.987 trillion views on YouTube in 2018 (an average of 16,937 views per video), representing 20% of all views on the platform. That compares with just 693 million views for gaming videos, representing an average view count of 2,987 and only 7% of all views.  

The relative profitability of gaming videos is further affected by their average length of 24.7 minutes, compared with just 6.8 minutes for music videos. “Gaming content is by far the longest, which requires YouTube to spend more money on hosting it,” wrote Pex founder and CEO Rasty Turek in a Medium post announcing the study. “Music, on the other hand, is the shortest of all categories, but in turn generates the most views per average video.”

Notably, the broader “entertainment” category boasted the highest number of views on YouTube at 2.416 trillion in 2018 alone, despite making up only 10% of all content on the platform. Pex notes that music and entertainment are the only two categories that “disproportionately deliver high returns ... on the investment,” while also being the least "native" to the platform -- meaning YouTube often has to license their content. 

The music category was also found to represent roughly 90% of all videos that had racked up more than 1 billion views. Last November, YouTube itself reported that over 100 music videos had reached that benchmark. 

Billboard reached out to YouTube for comment but did not hear back as of press time.

This isn’t the first study to have highlighted music's importance to YouTube. In 2016, IFPI’s Music Consumer Insight Report found that 82% of all visitors to the platform use it for music. Additionally, in their 2018 report, a survey of music consumers in 18 countries found that 47% of time spent listening to on-demand music was on YouTube.

This new study would appear to reinforce the argument of those in the industry who have long criticized YouTube for its payments to musicians, which amount to around $1.50 for every 1,000 views of a video -- considerably less than the amount paid by audio streaming services like Spotify and Apple Music.