According to various sources, Universal’s deal with YouTube has already expired and deals in place with the likes of Sony and Warner will time out later this year. As a result the major recording labels are in negotiations with YouTube and are demanding better rates than the ones they currently describe in disparaging terms.
So if the RIAA can negotiate decent deals with the likes of Apple Music and TIDAL, why does it continue to have problems with Google’s YouTube? To put it bluntly the labels believe that YouTube is gaming the system and unsurprisingly it all comes down to the safe harbor provisions of the DMCA.
While YouTube quickly responds to takedown notices sent by the labels, the RIAA says the platform is laden with unlicensed music uploaded users and as the law currently stands all it can do is keep taking it down. That’s something they do through gritted teeth.
In an interview with Recode, RIAA chief Cary Sherman was asked why following the Viacom case the labels don’t accept the current legal position. He pulls no punches.
“We accept the inevitability of death. It doesn’t mean we have to like it,” he says.
Describing the DMCA as “dysfunctional”, Sherman says that the Copyright Office’s consultation on the effectiveness of the DMCA is allowing stakeholders to have their say but in the meantime YouTube is bullying negotiations by utilizing the shield of safe harbor.
“When you compare what we get when we get to freely negotiate, with a company like Spotify, vs. what we get when we are under the burden of an expansively interpreted ‘safe harbor,’ when you’re negotiating with somebody like YouTube, you can see that you’re not getting the value across the platforms that you should,” Sherman says.
According to the RIAA chief the solution is for the current notice-and-takedown system to become notice-and-staydown, so that when one unlicensed copy of a song is removed from YouTube all other uploads of the same content are permanently barred from the system.
“If we had a system where once a song was taken down, you had a filtering system that prevented it from going back up, we wouldn’t have to be sending hundreds of millions of notices on the same content over and over again,” Sherman notes.
So the RIAA says its stuck between a rock and a hard place. On the one hand they want their properly licensed music on YouTube but in return they want all unlicensed copies of the same removed from YouTube on a permanent basis. Sherman says without that kind of agreement the one-sided negotiation process with the company goes something like this.
Look. This is all we [YouTube] can afford to pay you. We hope that you’ll find that reasonable. But that’s the best we can do. And if you don’t want to give us a license, okay. You know that your music is still going to be up on the service anyway. So send us notices, and we’ll take ’em down as fast we can, and we know they’ll keep coming back up.
“That’s not a real negotiation. That’s like saying, ‘That’s a real nice song you got there. Be a shame if anything happened to it’,” Sherman says.
In effect, Sherman accuses Google-owned YouTube of running a DMCA-protected protection racket, with music possibly being offered freely to the masses in the same manner that bars might get inexplicably fire-bombed in Chicago during the night. While Google hasn’t responded to Sherman’s comments directly, a submission it has made to the Copyright Office pours cold water on the flames.
“Some in the recording industry have suggested that the safe harbors somehow diminish the value of sound recordings, pointing to YouTube and blaming the DMCA for creating a so-called ‘value grab.’ This claim is not supported by the facts,” the company writes.
Noting that YouTube has had licensing agreements in place with the record labels for many years, Google says it is simply incorrect that it relies on the DMCA instead of licensing content. Furthermore, Google says that those who claim that royalty rates are too low because of the DMCA notice-and-takedown process are forgetting the tools already provided by YouTube.
“This claim…ignores Content ID, which has been in existence since 2008 and which record labels (and many other copyright owners) use every day to monetize their works on YouTube. Thanks to Content ID, record labels do not have to rely
solely on the DMCA’s notice-and-takedown process on YouTube — they can remove any or all user uploads of their works from the platform on an automated and ongoing basis,” Google writes.
“Indeed, since January 2014, over 98% of all YouTube copyright removal claims have come through Content ID. Although business partners can be expected to disagree from time to time about the price of a license, any claim that the DMCA safe harbors are responsible for a ‘value gap’ for music on YouTube is simply false.”
With this war of words set to rage on, RIAA chief Cary Sherman says that he hopes for a future in which the DMCA has been fixed and the balance of power shifts back to the labels.
“I think the record companies would like to be partners with YouTube. But it’s a little hard to call it a partnership when it’s so one-sided in terms of the negotiating leverage,” he says.
Notice-and-staydown certainly has the potential to push the point of leverage back into the labels’ favor, but there’s a long way to go yet. Content ID aside, it doesn’t look like Google wants to play ball either.
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