YouTube Goes to the Dark Side for Help With Its Label Fight
For most of the past year, YouTube has been fighting the music industry’s attempts to paint it as a cheapskate, and even a scofflaw, a haven for unfettered copyright infringement.
The company, which has been part of Alphabet’s Google (GOOG) operation for the past decade, has done its best to argue that these criticisms are misplaced and points out that it has paid record labels and musicians billions in licensing fees. But that has done nothing to stem the tide of discontent. So now YouTube has reached out to the dark side for some help in making its case.
The service’s new not-so-secret weapon is Lyor Cohen, the former head of Def Jam Records and Warner Music. Technically, his title is global head of music, but most in the industry believe his job will be peacemaker. As one entertainment insider said, it’s like the prosecutor just joined the defense attorney’s law firm.
But can Cohen persuade the major labels that YouTube doesn’t need to boost the amount it pays for music? If nothing else, he might be able to convince them the streaming service is trying hard to keep copyright infringement to a minimum. But it’s mostly about the money.
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The core of the industry’s argument is that YouTube doesn’t pay as much for music as services like Spotify do, and therefore it needs to cough up more cash.
YouTube can afford to pay more, obviously, thanks to its wealthy parent—but it doesn’t think it should. It says its current advertising-based music-licensing system is working just fine. Whether Cohen can somehow help close that yawning gap is the multibillion-dollar question.