YouTube Is Rethinking Its Tough Stance Against Indie Labels

YouTube is being accused of issuing an "ultimatum" to indie labels.

youtube logoFor the longest time, YouTube was known as the place to go for grainy home videos of the funny, the incredible and the mundane. Now the site is an Internet staple. Big brands rely on it for their marketing efforts. Entertainment companies use it to introduce upcoming projects. Everyday people have stepped up their game, making it the place for not just low-budget clips but higher-production videos that have the capacity to go viral in a major way.

And now that MTV doesn’t really show videos anymore and fans haven’t made the shift to networks like Revolt and Fuse at a tremendous volume (that, of course, could change), YouTube has become a key online place for music videos. So it was a big blow to indie labels when they were faced what’s being called an “ultimatum” from YouTube.

“Indies were rankled most by what appeared to be an ultimatum by YouTube, with the company telling labels that they would remove advertisements on their music videos, the service’s principal revenue generator, if they refused the contract’s terms, cutting them off from a stream that generates hundreds of millions of dollars for labels each year,” reports The Hollywood Reporter.

When did YouTube turn into a grumpy old man?

The video site now seems to be changing its tune (according to Financial Timessub req’d), which is a good thing for its street cred.

About a week and a half ago, indie trade organization IMPALA filed a complaint against YouTube, calling its terms “anticompetitive behavior,” Billboard adds, with the president of the American Association of Independent Music Rich Bengloff saying earlier that these labels get on well with “Rdio, Spotify, Rhapsody and about 20 other services, but obviously not YouTube.”

YouTube has a big marketing push focused on some of its own homegrown stars. So it’s trying to give off the vibe as the place to be if you’re an aspiring creative with something interesting to share with the world. It’s supposed to be the cool place to be, not “the man” trying to push around the little guy. This news about indie labels runs counter to this marketing message.

Which might be why the site is “back-flipping and backtracking,” according to the FT. If YouTube wants to continue to be the place that attracts tons of viewers and content creators from all backgrounds and interests, it can’t start strong-arming organizations into contracts that come off as highly unfair to those that don’t have a big name or big money behind them.

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