YouTube’s Premium Tier Is Coming Very, Very Soon

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We’re not sure exactly how this fits into YouTube’s planned Music Key expansion, but an ad-free version of the video service is definitely on its way.  Over the weekend, YouTube started sending letters to holdout content owners requiring agreement to updated terms and conditions that would enable the premium upgrade.

Content owners have until October 22nd to update the agreement, or their videos will be removed.

The email, leaked to Re/Code, notes that ’95 percent’ of content owners have already agreed to the updated terms.  “To give fans more choice we will be launching a new ads-free version of YouTube, available to fans for a monthly fee,” YouTube offered in the email.   “This service will create a new source of revenue over time that supplements your advertising revenue.  We want to ensure that fans who choose to pay for an ads-free experience can watch all the same videos that are available on the ads-supported experience.”

But, don’t play ball, and you can find somewhere else to put your videos.  “If you haven’t signed by that date, your videos will no longer be available for public display or monetization in the United States,” the note warns, though rights owners will have the ability to change their mind after October 22nd and revive their videos.

 

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Re/Code noted that the ad-free YouTube would be packaged into a Music Key launch, though that represents the latest switch-up in a disorganized and delayed release.  “An update of its music service, which it launched in beta as YouTube Music Key last fall, and another service, yet to launch… will give users the ability to watch anything on YouTube without seeing ads,” Re/Code notes.

Regardless, it now definitely appears that YouTube will not be tolerating holdouts.  Several months ago, YouTube threatened artists that refused to participate in Music Key by removing their channel content, a harsh step that was initially denied until transcripts proved the harsh stance.  Since that point, YouTube remained vague on when Music Key would launch, with executives hesitant to commit to a timetable.

 

More details as they emerge.

22 Responses

  1. Anonymous

    Google had to react to Apple’s attack, and fast.

    But this won’t work. So they need to switch to plan B if they want to survive:

    Ad-blockers not allowed on YouTube and Google Search.

    Reply
  2. Anonymous

    “But, don’t play ball, and you can find somewhere else to put your videos

    Interesting times — huh, Sarah? 🙂

    Reply
    • Sarah

      Indeed. We’re talking with labels right now. The next 6 months are all about building up our content before launching to consumers. 🙂

      Here’s some food for thought:

      A survey we just did shows that at least 35% of people are willing to pay to stream music. The average price they indicated they’d be willing to pay was 2.8 cents per stream.

      The effects of converting ad-supported users to PAYG at 2.8 are astounding. But even if you go with a significantly lower price point (e.g. 1 cent) or conversion rate (5%), the effects on revenues are still significant.

      There’s a lot of value out there going uncaptured by rigidly sticking to only subscription and ad-supported business models, and it’s literally killing the industry.

      Reply
      • Anonymous

        “We’re talking with labels right now. The next 6 months are all about building up our content before launching to consumers”

        See ya in April… 🙂

        Reply
        • Sarah

          Yep.

          Check out the calculator at https://www.repx.net/Business/AV/ to see the impact that introducing a PAYG option could have on revenue. Even tiny conversion rates make a big difference …. all made possible by how pitifully low current payouts are.

          Reply
          • Anonymous

            And that’s all very interesting. I’m just not sure you understand your own specific appeal.

            Everybody’s on YouTube — but not because of the money. Cause there isn’t any. We use YouTube for something else:

            Exposure.

            And we use exposure to send fans to iTunes.

            But here’s the thing: We won’t be able to do that anymore. The next version of YouTube doesn’t allow for exclusive iTunes releases. Our entire catalogs will be available on the service. So fans won’t need iTunes links anymore. They already have it all. Right there, on YouTube.

            So you need to deliver what YouTube no longer provides:

            Total exposure — no strings attached! No offensive contracts. Just millions of views.

            That’s your only selling point.

            And the only way for a new service to deliver that amount of eyeballs is to use third-party social media like there’s no tomorrow (e.g. take embedding to the next level).

            Nobody cares if 35% of zero users are willing to pay 2.8 cents per stream.

  3. Anonymous

    “give users the ability to watch anything on YouTube without seeing ads”

    This statement is so mindblowingly stupid.

    Why would anybody pay $10/month when adblockers are cheap — or free — and now available on all platforms, including iPhone?

    Reply
  4. DavidB

    The statement that “If you haven’t signed by that date, your videos will no longer be available for public display or monetization” appears inconsistent with YouTube’s earlier statements, notably in their exchange with Zoe Keating, where they said that videos could still appear on YT, but without the monetization option.

    Reply
    • Anonymous

      “The statement that “If you haven’t signed by that date, your videos will no longer be available for public display or monetization” appears inconsistent with YouTube’s earlier statements

      Yes — but it is correct. You can find the text on YouTube’s Partner terms update FAQ (I’ll post the link in a separate comment below):

      “Partners who need more time to review and accept these terms will have their videos made unavailable for public display or monetization in the United States.”

      Here’s the old FAQ from the same site:

      “ARE YOU REQUIRING PARTNERS TO UPLOAD A CERTAIN AMOUNT OF CONTENT OR GUARANTEE EXCLUSIVITY?

      THERE ARE NO MINIMUM CONTENT REQUIREMENTS OR EXCLUSIVE ARRANGEMENTS WITH YOUTUBE IN CONNECTION WITH THIS AGREEMENT UNLESS OTHERWISE AGREED UPON WITH YOUTUBE.”

      But that’s gone now…

      Reply
  5. Remi Swierczek

    YouTube is a mindless pulverizer of MUSIC under watchful EYE of idiots from UMG observing brilliant performance of advertising money flow of VEEVOOOO!
    Vevo the greatest accomplishment of British occupiers of UMG should CLOSE NOW!

    The BEST function of YouTube in music business is to become the wholesale supplier of coded music to Radio and streaming converted to $100 billion dollar music store!

    If we add McDonald, Nordstrom, Starbucks or Chipotle MUSIC STORES we’ll have $200B music industry by 2025!

    Note to Google, YouTube, Susan Wojcicki and Larry Page: AT THAT POINT GOOGLE WILL BE AT $175B and more than 50% of revenue will arrive from MUSIC MONETIZATION.
    Primitive plan with need for action on Google side.

    Reply
  6. Anonymous

    Guys, here’s an extremely interesting fact about FACEBOOK VIDEO:

    TIDAL uploaded a 30 sec. teaser for Beyoncé’s and Minaj’s “Feeling Myself” to YouTube and Facebook 4 months ago.

    YouTube views: 8,283,842
    Facebook views: 12,920,719

    So you get more than 50% extra views on Facebook!

    And not only that:

    1) After watching the YouTube version, you get a bunch of non-related Vevo spam — but the last frame of the Facebook video is a permanent link to TIDAL! So this link has been exposed to almost 13m fans!
    2) There’s 1 (one) comment on the YouTube page. There are 24,726 on the Facebook page…

    Wow!

    Reply
    • There is something...

      You are forgetting here that FB videos start when you browse your timeline even if you don’t want to watch it. So we need to know how many “unwanted” views are included in those numbers. I’m not saying it’s a bad thing (you may find the video cool and check the song even if you didn’t really want to watch it in the first place) but you can’t compare FB and YT numbers like that.

      Also, I’m afraid that in the long run FB will get overloaded with videos all over your timeline, making it very difficult to stand out and get noticed.

      Reply
      • Anonymous

        “You are forgetting here that FB videos start when you browse your timeline even if you don’t want to watch it. So we need to know how many “unwanted” views are included in those numbers”

        That’s true! But, like you say, “unwanted” views can be useful, too. It’s just another approach.

        And the fact that you can make exclusive iTunes releases compensates for a lot of minor issues!

        Reply
        • There is something...

          The problem with FB is how they deal with what goes on your timeline. We know that for artists it’s difficult to make all your fans see your updates unless you pay FB for it. I’m afraid that when everyone and their dog will upload tons on vids everyday FB will come with some kind of algorithm that really limits what you will see. Youtube is not perfect, but at least you know who you can reach and who you don’t, and they don’t ask money to let you promote your contents.

          Reply
          • Anonymous

            “they [YouTube] don’t ask money to let you promote your contents”

            Except every cent I make from iTunes!

            (Hint: Nobody clicks that iTunes link in your YouTube video when s/he can get the song one click away, for free.)

            And don’t forget that Beyoncé’s video got 24,726 x more comments on Facebook, as well. A lot of that activity translates to iTunes dl’s and ticket sales.

            Bottom line:

            You get more hits on Facebook; you get significantly more response, you don’t lose your iTunes income and you don’t need to sign any creepy contracts that’ll haunt you for years.

          • There is something...

            That’s a far too small sample to jump to conclusions… FB videos are somehow still in “beta”, we don’t have any real information on how this will turn out, how it will be monetized and how algorithms will work in the futur.

            Also, the Youtube link goes to the Tidal channel… Who watch Tidal’s channel ? Fans will go to the artist channel, not Tidal. Look at Minaj’s Vevo, there are far more views and comments ! You need to compare apples to apples if you want serious numbers.

          • Anonymous

            “FB videos are somehow still in “beta”, we don’t have any real information on how this will turn out, how it will be monetized”

            That’s true for the next YouTube, too.

            But this we know: Facebook allows you to make a living as a recording artist — YouTube does not.

            And I’m not suggesting it’s because Facebook is more ethical than YouTube. Google just happen to be at war with Apple and nothing would be sweeter than killing iTunes. Just like killing Android is Apple’s wet dream. And we’re caught in the middle, abused by both sides.

            Facebook is not involved in all that, not directly anyway.

            It just really, really wants to know everything about you — and protect you from the female nipple. 😐

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