For the first time ever, streaming now accounts for the majority of the music industry's income, at least in the United States. The tremendous growth seen by music streaming has also helped the music industry post the biggest yearly growth since 1998.
Including but not limited to Spotify, Pandora, Apple Music and YouTube, streaming accounted for 51% of music revenue in the U.S., bringing the total to US$7.7 billion for 2016. This is a 11 percent jump from the previous year, the biggest growth since 1998, at the height of music CD sales.
Music industry revenue is still down compared to that time though, with the current numbers only half of what it used to be. This is largely attributed to the changing buying habits of music fans, going from buying albums to much less expensive individual tracks.
Music subscription services, such as Spotify, accounted for most of the revenue growth. Almost 23 million users in the U.S. now subscribe to some kind of music streaming service, accounting for a third of all music sales.
But even with this set of stellar results, many in the music industry are still unhappy with the revenue sharing deal with Spotify, and in particularly the current situation with YouTube.
The music industry's copyright lobby, the RIAA, says the payout for streams on YouTube is only a fraction of what they would get from the likes of Apple Music or Spotify. The RIAA says that lax copyright laws are to blame, and has accused YouTube and parent company Google of profiting from piracy.
Current copyright laws protect Internet sites like YouTube from being liable for user uploaded content as long as the site has an active and workable way for rights-holder to identify and remove copyrighted works. The RIAA says this is not enough, as it places the onus on rights-holders to find and remove pirated content.
The RIAA argues that due to the widespread availability of pirated works on YouTube reduces the negotiating power of record labels when it comes to licensing deals.
YouTube argues that only rights-holders are capable of identifying which works belongs to them, and that YouTube has already gone beyond what's required to implement Content ID, an industry leading automated piracy scanning engine that can either remove pirated content, or pay rights-holders for any ad revenue earned from the pirated uploads. YouTube says they have already paid rights-holders more than $1 billion in fees in 2016 alone.
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