BPI’s AGM: Content Monetization via YouTube & Digital Amplify Success
YouTube was prominently featured at the BPI’s AGM, held in London earlier this month, along with a “Dragon’s Den” style tech startup derby. TMV’s Laura Thorne provides an event summary and sifts through the numbers.
The British Phonographic Industry’s Annual General Meeting is where industry leaders assess the year past, review issues present, and find out what their industry representatives will be keeping an eye on over the next twelve months – all in about four hours, including lunch and keynote (delivered by Harriet Harman, Shadow Secretary of State for Culture, Media and Sport, and Shadow Deputy Prime Minister).
If last year’s BPI strapline, “Music is Everywhere,” was a bit matter-of-fact, the mood this year was positively chuffed as reflected in this year’s tag, “Amplifying Success.”
The UK music industry certainly has reason to be cheerful; with around 22 million sold of Adele’s “21,” Britain has asserted its pop bona fides in a way that is pretty hard to argue with, and Adele claimed virtually every top spot, whether singles chart, downloads or most awards received by a single individual. (Recent Ivor Novello award winner Ed Sheeran, The Wanted, One Direction and Jessie J are also making inroads internationally, so there’s more where that came from.)
To get a sense of where the industry’s attention is focused, one only needs look at the speakers scheduled for the morning’s presentations. At centre stage were four members of the YouTube team, in what was essentially an extended promo op for content monetization via YouTube’s alliance with Google AdSense, and other revenue producing opportunities courtesy of YouTube’s partner programs. This was all very useful, relevant information, and there’s no question that YouTube is a fantastic way to promote music; however, wouldn’t one assume that everyone present in the room is already well familiar with its use and how to make money from it?
The other elephant in the room that was not mentioned at all was the payment of royalties. As virtually everyone reading this knows, the terms of the PRS agreement with YouTube were blacked out via a NDA. So the rates paid per play are not known to those who provide content to the service, a situation that has resulted in some crankiness. YouTube’s position is that they “don’t discuss revenue.” One can debate the fairness of that, but given YouTube’s dominance many choose to take it rather than leave it, concluding that half a loaf is better than none.
And yes, the half a loaf does generate real income for some: what YouTube will say is that, as of this writing, they have 800 million unique visitors every month, that there are 72 hours of content uploaded every minute (up from 60 hours in January), that revenue on partner channels has “more than doubled, four years in a row” and that they have “thousands of partners making six figures per year.”
Inquiries to the BPI about user behaviour among their membership and any data about YouTube and the revenue it might represent vis-à-vis other streams, even using estimates, were not fruitful as this has not been documented or studied. Similarly, the PRS either did not have answers to or could not provide the specific answers that we sought, but what they did say does provide at least a broad indicator of how YouTube royalties might contribute to the whole as follows:
Digital Royalties, UK:
2011 = £38.5m
2010 = £26.5m
2009 = £25.4m
2008 = £17.6m
That’s roughly a 56% increase in a four-year period, but we don’t know what slice of the pie is attributable to what.
Again, not to beat up on YouTube in terms of its merits as an effective promotional tool – and a revenue generator – but is this level of skullduggery really necessary? Are the rates that low that there will be a mass revolt if they are disclosed? Who is wearing the pants in this relationship between content creators and content distributors?
The other subject of continued avid interest on the part of the industry is in the area of technology. Last year, a panel of speakers including representatives from Soundcloud, Topspin, and others provided an overview of their services. This year, Paul Brindley of IC Connect & Music Ally, moderated a demo derby of six emerging startups that presented their wares, followed by a vote by the audience for the winning proposition. (These contests are happening everywhere it seems in London, and TMV has covered a few, including Techpitch 4.5. Also read our interview with Greg Kris, CEO of music metadata startup Decibel for more on London’s startup climate.)
They were evaluated on the basis of three criteria: innovation; relevance (to the audience) and commercial/business model. The audience vetting put BandApp out front, with CueSongs a solid #2 and the remaining four failing to generate much interest. What is there to extrapolate from this? Is it that BandApp and CueSongs have been more effective at promoting themselves so have greater name recognition, or are they just no-brainers that really do fill a market need? Perhaps they just are easier to understand and develop, with fewer potential complications logistically; not innovative perhaps, but sensible and well-executed.
After lunch, BPI Chairman Tony Wadsworth provided an impressive roll call of 2011 statistics, including:
- 12.6 % of recorded music sales worldwide are by British artists.
- There was a 26.6 % growth in digital sales (digital now represents 55.5% of sales overall)
- The creative sector is the UK’s third-biggest economically
- British artists had the top selling recording globally four out of the last five years
- Nine out of ten British artists think that the latest Spice Girls reunion is rubbish.
Wadsworth also chided the current UK government by saying that they have been blinded by the yellow brick roads of Shoreditch.
Harman got off to a nimble beginning by calling Google the “third party of the British government” and observing, “Number 10 can’t stand up to Google, and Jeremy Hunt can’t stand up to #10.” (I guess we do know who wears the pants then.) Harman then went on – quite rightly – to give banks a bit of slapping around, asking how small music businesses could be denied investment for being “too risky,’ by banks that have acted as casinos and engaged in profligate speculation. She called for tax breaks for, and greater investment in, the music industry and for protection of IP, not just as “a private matter, but a matter of public interest.”
Of course, Ed Vaizey also got off numerous applause lines last year, and when David Cameron spoke in 2007 it’s likely that he said something that people liked too, so let’s all keep our knickers on.
CEO Geoff Taylor did a few victory laps around the podium, speaking about success curbing piracy and illegal filesharing and citing the evisceration of Pirate Bay. The BPI works diligently to promote “positive online behaviour” and move consumers away from the expectation that the internet is a place where they should get something for nothing.
Other activity included the election of BPI representatives and a brief speech by Julian Wall (Director of International Events & Member Services), who, voice breaking, announced he is leaving BPI after four years in the role.
A panel titled “Amplifying Success – Turning Creative Ideas into Business in the Digital Age” followed, moderated by journalist Miranda Sawyer with guests Will Kennard and Saul Milton (aka Chase & Status), Tony Parsons (British Author and Journalist) and Stephen Garrett (Chairman, Kudos Film & Television).
Paul Shevlin closed out the afternoon fittingly with a solo vocal/keyboard performance. Describing his sound as “piano-pop with a kick up the arse,” young Shevlin (all of 20 years old) showed himself to possess a significant talent when it comes to download & radio-friendly, of the zeitgeist songcraft. He also stayed around during the inevitable afternoon drinks session, taking questions from anyone who asked with good cheer and enthusiasm. If he didn’t have at least one solid offer of a deal by the end of the day, I’d be very surprised.
The BPI pack in a fantastic amount of information into a half-day event, and for a snapshot of the UK music industry, there’s no other place to be.
- YouTube Vs. PRS – Whoever Wins, It Will Probably Be Bad News For Content Owners
- YouTube’s Missing Monetization Makes Its Internet TV Prospects Patchy
- Job: Head of Strategic Partner Development, Music Content, YouTube, Europe (London, Paris)
- Event Report: Digital Content Monetization (Part II)
- Event Report: Digital Content Monetization (Part I)