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Speaker 1: Industry news.

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Speaker 2: Hopefully it's interesting to you music business worldwide reporting that

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Billboard just made free streams worth more on its US charts.

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YouTube is not happy and is pulling its data. So Billboard,

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of course, you know, they've got their their various charts.

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I used to love when I was a kid, because

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I was a music industry nerd, probably starting in high school.

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I would I remember going to the school library and

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I would always look for the newest Billboard magazine and

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I would read that. That's how much of a music

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industry nerd I was from a very young age. You know,

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obviously I played an instrument and I was into playing music,

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but I was also very fascinated by the music business.

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So I would read Billboard. I wouldn't necessarily read it

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cover to cover. There's some things I wouldn't necessarily pay

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attention to, but I always like to look at the charts.

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You know, you've got the Billboard Hot one hundred, and

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you've got you've got all these different charts in Billboard.

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And of course now you can access it all online

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if you have a subscription, which I don't because I'm

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not gonna spend that money. But but the way that billboards.

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So the way that Billboard used to back in the day,

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back in my day, the way that is, you know,

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what would go into the into calculating the chart positions

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would be metrics like sales, because back then singles would

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you know, you would have singles. You would have you

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had Vinyl forty five records if you go way back.

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But of course you also had cut singles. If you

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remember cus singles. I was in a band called the

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Jenkston We used to joke that we were going to

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release a single.

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Speaker 1: We never did.

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Speaker 2: And of course you had CD singles and so forth,

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so you had single sales, but you also of course

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had radio airplay. Radio airplay would play a big role

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in how Billboard would calculate the charts, and I'm sure

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it still does obviously. But and also MTV. I don't

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know if but I don't think MTV. I don't think

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rotation of a music video on MTV was ever a

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part of the data that Billboard would use. I could

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be mistaken about that, but I don't think that it was.

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I don't think they ever.

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Speaker 1: Used that data.

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Speaker 2: As far as the charts, I think it was all

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airplay and sales, not not MTV or VH one or

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anything like that. Again, I'm pretty sure I'm right about that.

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But but so today it's all different, right, because we

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have the Internet. So today things that go into Billboard

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charts are things like, uh, you know, how many people

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are listening to a song online?

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Speaker 1: Radio airplay is still, of course a big part.

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Speaker 2: Of it, but but online, what's happening online? You know,

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it's much more complicated now, right, It's it's because it

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used to be. If you're if the only data points

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you're using are you know, you can have a concrete

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number you can look at, right, how many did this

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track sell in terms of singles?

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Speaker 1: How many did it sell in the stores?

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Speaker 2: And you know radio stage when they report their playlist data,

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you know how many spins did this get? Okay, these

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are these are metrics that we can use and calculate,

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and you know they have whatever formulas they use, obviously

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one ways more than the other. But but you figure

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it out, right, you have hard numbers to look at,

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and I guess you still have hard numbers to look at.

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But now it's like streaming, you know, and you've got

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many different streaming services and it's a lot, right, So

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it's all much more complicated now. One of the ways

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that people access music to listen to his YouTube. It's

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the easiest way, you know. You can go on YouTube

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finds us about anything. You're not going to get as

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high a quality file as you would if you actually

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purchase a wave file or an MP three. A wave

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sounds better than an MP three, a CD sounds better

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than either one, and a vinyl record sounds better than

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all of it. But but you can go on YouTube

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and just listen to music, and that's what a lot

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of people do. That's how a lot of people discover

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new music is YouTube. So here's what's happening. Just give

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you some context for what we're talking about here. So

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getting back to the story, so YouTube says again this

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is from music business worldwide dot com. YouTube says it

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will soon stop providing data to Billboard for inclusion in

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the US charts, ending a partnership that has lasted more

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than a decade. The decision, announced on December seventeenth by

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Lee or Cohen, YouTube's global head of music, comes just

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one day after Billboard revealed changes to its chart methodology

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that will actually narrow the waiting gap between paid and

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ad sponsored streams, So the waiting gap, and I did

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refer to it, but so different metrics have different weight,

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so you might have However, many paid streams might have

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a certain weight AD supported streams which are free. You know,

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like if you you go to listen to a song

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on YouTube, but before you can actually hear the song,

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you've got an AD that you have to click skip on,

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or you have two ads, one you can't skip and

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then the second one you can. That's usually how it

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seems to go, right, So that's an AD supported stream,

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So that's free. So in theory, paid streams would weigh

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more if you're calculating where on the chart this track

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is gonna go, this single, you're gonna you know, because

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people who are actually paying for the stream or for

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the track, I should say, people are like if they're

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paying to download it, for example, then you know they

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might care about it a little bit more than people

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who are just going on YouTube and listening to it

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for free, so you weigh that. So so they've narrowed

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the gap between in terms of what each of those

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metrics weighs paid versus free Essentially okay, under Billboard's current

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formula for the Billboard two hundred. One album unit equals

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two hundred fifty paid subscription streams or three thousand, seven

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hundred and fifty AD supported streams, a one to three

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ratio Billboard's new methodology announced yesterday, Well, this was this

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one up a few days ago. Announced on December sixteenth,

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Titans that ratio to one to two point five, with

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one album unit now equally one thousand paid streams or

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twenty five hundred AD supported streams. The same ratio is

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being applied to the Hot one hundred chart. In other words,

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paid streams. This is the This is the important part.

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Paid streams will still be weighted more favorably than AD

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supported plays, but by a smaller margin than before.

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Speaker 1: That's interesting.

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Speaker 2: Yet, in a statement today Lee or Cohen said the

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changes do not go far enough YouTube.

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Speaker 1: This is why YouTube is not happy.

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Speaker 2: YouTube wants all streams to be counted equally on Billboards charts,

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regardless of whether they come from paid subscriptions or add

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supported services. Before we go any further what Cohen said,

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let me just say this. I would think that that

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would be a hell of a lot easier for Billboard.

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Speaker 3: Right because if they did it that way, if they

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took his his suggestion, just stop giving anything more weight

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than anything else.

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Speaker 2: You just count it. You just count it all. Just

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the numbers are. What the numbers are. You count it all.

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You add it up. There's your numbers. Because it just

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seems like it would be a lot easier. Now, maybe

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maybe I say that because as someone who's not good

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at math, I want math and numbers to be easy.

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That's my natural I have a natural impulse. I have

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a bias there, right, I want I always want math

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and numbers to be easy, because I'm not good at math.

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But you know, it does seem like it would be simpler, right,

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It'd be a lot more efficient. I mean, they still

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I can't imagine how many data analysts Billboard has working

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for them. I'm sure it's a lot. But here's what

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Cohen said in his statement. Though, he said quote Billboard

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uses an outdated formula that weights subscription supported streams higher

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than ads supported. This doesn't reflect how fans engage with

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music today and ignores the massive engagement from fans who

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don't have a subscription. We believe every fan matters and

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every play should count equally. Therefore, after January sixteen, YouTube

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data will no longer be delivered or factored into the

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US Billboard charts unquote. Now, in thinking about that, how

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does that affect How does that affect artists and.

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Speaker 1: Labels and.

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Speaker 2: Everybody who has music streaming on YouTube? Well, if you're

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getting a lot of streams on YouTube or at well

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here's here's something. What if you're an artist who does

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not put your music on Spotify because you're mad about

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how little Spotify pays out, which is a whole other subject.

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I'm not trying to take that side street, but I'm

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just it works for this example. Say you're an artist

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and there's a lot of them. There's both established artists

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who pulled their music from Spotify because they're mad, and

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there's independent artists. There's small artists who just don't want

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to put their music on Spotify, which I personally think

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is a mistake. I think you should still put your

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music on Spotify, even if you're not happy that they

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don't pay you anything. Because discoverability is a term that

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I like to use and that we use in the

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industry that you have to make your music discoverable in

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order for people to discover it. So you want to

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be in as many places as possible. That's my philosophy.

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Some people disagree. We've had guests on the show show

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who disagree.

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Speaker 1: That's fine. But what if you're not on Spotify for.

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Speaker 2: Whatever reasons, whatever your reasons are, and so YouTube is

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your fallback. YouTube is where people are gonna find you

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and you want to be charting. Now, if you're an

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unsigned or small independent artist, you know you might maybe

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it doesn't matter to you because you know that you're

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not going to chart, you know, unless you get like,

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unless you blow up, you know, unless you get really big,

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you're not going to even have a shot at charting

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in Billboard anyway. So maybe it doesn't matter to you.

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But if that's the long term goal, it should matter

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to you. So if you are not on Spotify, or

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if you are on Spotify, but that's not where you're

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catching fire. You're catching fire on YouTube. That's where you're

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getting the spins, the plays spins more of a radio term,

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but the plays, you're the streams on YouTube. You want

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those numbers to count, do you not? So this is

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this is going to upset some people. So let me actually,

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let me read this from Cohen's quote again, because I

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just want to make sure. This is the most important

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thing that he says here. Streaming is the primary way

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people experience music, making up eighty four percent of US

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recorded music revenue. We're simply asking that every stream has

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counted fairly and equally, whether it is subscription based or

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ad supported, because every fan matters and every play should count.

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Speaker 1: Unquote.

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Speaker 2: YouTube was first included in the Billboard Hot one hundred

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in February of twenty thirteen. I didn't know that it

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was that recent. I mean, we're coming up on twenty

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twenty six, so thirteen years ago, I guess. But still

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I for some reason I thought it had been even

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sooner than that.

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Speaker 1: But it wasn't so.

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Speaker 2: And that was probably a big decision on Billboard's part

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when they when they decided to that. So YouTube was

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first included in the Billboard Hot one hundred and February

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of twenty thirteen, and was later added to the Billboard

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two hundred album chart in January of twenty twenty. Cohen said, quote,

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after a decade long partnership and extensive discussions, Billboard are

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unwilling to make meaningful changes. We are committed to achieving

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equitable representation across the charts and hopefully can work with

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Billboard to return to theirs unquote.

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Speaker 1: The question.

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Speaker 2: This is interesting. So the question of how to wait

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differences different types of streams has been contested since Billboard

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first introduced tiered streaming values in twenty eighteen. Prior to

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that change, all streams, whether from paid services like Apple

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Music or ad supported platforms like YouTube, were counted equally.

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So there was a time when when Billboard was just

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counting them all equally and not waiting one source of

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stream versus the other. In a twenty seventeen interview with

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Music Business Worldwide, Apple's Jimmy Iavine argued that having YouTube

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streams count equally alongside paid for music on Billboards Hot

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one hundred disadvantaged artists. Iavine was unequivocal about how his

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view about his view that paid streams should carry more

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weight on industry charts. He said, quote, I'll put it

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this way, people who pay for subscriptions should be advantaged.

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The labels owe it to their customers. The most important

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thing for labels is to make the paid services compelling

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and entertaining, and don't make free services as good as

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the paid services. Is that not obvious? Unquote, I don't

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necessarily disagree with his life. I understand the argument that

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he's making. I think we all can. I just but again,

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it's it just makes it. I mean, doesn't it make

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it more complicated? The more complicated you make it too,

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aren't there more chances for there to be errors? Calculating errors,

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math errors? Again I'm thinking of I know I'm approaching

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it with a bias of someone who the bias of

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someone who doesn't like math. But I'm just saying, I mean,

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I think it's I think when you try to weight

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different sources, it just makes it complicated, because then how

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do you figure out how much you should I mean,

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you know, obviously Billboard is trying to figure that out now,

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they're changing how much they weigh certain sources of streams.

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When the twenty eighteen changes were implemented, paid subscription streams

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were weighted more heavily than AD supported streams on both charts.

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On the Hot one hundred, paid streams were given full

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point value AD supported streams two thirds and programmed streams

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half On the Billboard two hundred, it took three times

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as many AD supported streams as paid streams to equal

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one album unit. Recent data shows that the US recorded

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music industries. Overall streaming revenue performance in twenty twenty four

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was dragged down by payouts from on demand ad supported

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music services, including YouTube and Spotify's Freemium tier. Combined, these

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platforms saw their revenue contribution to the recorded music industry

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decline in the last year, down one point eight percent

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year over year to.

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Speaker 1: One point eight three billion.

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Speaker 2: Meanwhile, on demand paid subscription platforms contributed eleven point six

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eight five billion dollars to recorded music right soldiers, up

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four point six percent year over year. The disparity and

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revenue per stream between paid and free tiers is at

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the heart of the debate.

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Speaker 1: As Iving said.

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Speaker 2: In twenty seventeen, quote, the fact is that free quote

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unquote in music streaming is so technically good and ubiquitous

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that it's stunning the growth of that. It's stunting the

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growth of paid streaming. Two things have to happen. Free

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has to become more difficult or restricted, and the paid

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services have to get better unquote. Well, free is never

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going to become more difficult or restricted. I mean, that's

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not going to happen. Ever, Cohen's announcement represents a reversal

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from twenty nineteen, when he welcomed YouTube's inclusion in the

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Billboard two hundred, calling it a quote very important moment

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and making the chart a more accurate representation of what

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people are listening to unquote. At that time, Cohen said,

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quote genres like Latin hip hop and electronic, which consistently

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dominate the YouTube charts, will now be properly recognized for

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their popularity. This is another great step in bringing YouTube

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and the industry together unquote. YouTube reports in October that

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it paid more than eight billion to the music industry

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during the twelve months from July twenty four to June

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twenty five, covering revenue from both advertising and subscriptions on

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the Google owned platform. In his statement December seventeenth, Cohen

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directed fans to YouTube's own charts as an alternative to

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Billboard's lists. He said, quote, if you're curious about what

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music is making waves on YouTube, you can visit our charts.

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Speaker 1: Unquote. Well that's a good point, I guess. So there

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you have it.

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Speaker 2: The other thing happening very very quickly with YouTube, and

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this is from Digitalmusicnews dot com. YouTube is reportedly terminating

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channels behind fake AI film trailers our AI music page takedowns. Next,

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this is short, but let's do this quickly before we

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go to break. YouTube has reportedly started terminating some of

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the channels be behind unauthorized artificial intelligence film trailers. Is

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a crackdown on AI music accounts coming, though it'll be

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up to the new year to deliver an answer, we

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can be sure of two related points at present. First,

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the video sharing giant has booted screen Culture and k

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H Studio, a pair of prominent fake trailer specialists, according

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to deadline from the platform all together, so both those

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channels have been booted per the same outlet. The terminations

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followed considerable pushback against the channels, and, while it probably

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doesn't need saying, said pushback was set in motion by

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the involved uploads reach and adjacent ability to confuse fans

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or at a minimum, distract from proper trailers. So, in

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other words, these channels were making their own custom trailers

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for movies. Screen Culture allegedly pumped out twenty three fake

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trailers for the Fantastic four First Steps, with a few

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outranking the actual trailer itself, boasting around seventeen million views

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in search results. Long story short, YouTube had reportedly slapped

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screen Culture and kh Studio with a monetization time out

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which ended when they started adding disclaimers like fan trailer

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and parody to their upload titles. But the channels, having

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reportedly generated a combined one billion or so of views,

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are said to have reverted to their old ways, an

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alleged move that then drove the takedowns. Second, we can

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also state with confidence that there's a massive amount of

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AI audio inundating DSPs and in the process stealing fans,

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playlist spots and royalties from real artists. Then we talk

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about that on the show all the time. The impact

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that AI is having, as most are aware, allegedly infringing

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machine made tracks as well as tracks that make too

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big a commercial splash typically face takedowns and or threats

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of legal action.

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Speaker 1: In general.

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Speaker 2: However, it's a different story for the advance avalanche of

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AI songs with comparatively modest stream and view counts. As

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demonstrated by hard data and Curse Rey DSB searches alike.

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These creations, while not yet outshining genuine music, are subtily

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expanding their presence on platforms such as YouTube and Spotify.

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Speaker 1: Well, the thing is.

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Speaker 2: As long as your as long as your channel doesn't

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get huge, you stay under the wire.

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Speaker 1: If you under the radar would be a better way

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of putting it right.

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Speaker 2: So, if your channel gets too big, you might get,

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for example, you might get copyright claims or I'm sorry,

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copyright strikes. Copyright claims are one thing, copyright strikes or another.

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You don't want copyright strikes. You can get copyright claims.

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I get copyright claims all the time. I put you know,

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this radio show streams on YouTube, and obviously we're playing

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copyrighted music. I can never monetize this, that's fine. I

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can never monetize the show on YouTube, that's fine. Couldn't

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do that anyway. It contains advertising. I don't care about that.

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I'm just streaming it to YouTube as it just gives

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people another way to enjoy the show. They don't they

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don't block my videos, they just won't ever let me

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monetize them.

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Speaker 1: And again I'm fine with that.

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Speaker 2: But if if I got big enough where you know,

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a label, I mean, I'm I'm a small time. But

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if I were like this huge, I mean, if I

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were big enough, I wouldn't I would just not stream

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the show on YouTube anymore because I would know because

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I would see what was coming. Right, if I were

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big enough that I got the attention of the labels,

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they you know, somebody might issue an actual copyright strike,

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and a copyright strike would put my channel in danger.

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So I wouldn't do that. You know, I'm at a

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level where I you know, I do it. It's fine,

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I get copyright claims, but that just means you can

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never monetize this video. Fine, I can't monetize any of them.

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It's fine.

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Speaker 1: But but if you get.

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Speaker 2: Big enough, YouTube notices or someone notices who will then

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complain to YouTube effectively, and then YouTube will begin to

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penalize you. You know, the first might be just demonetizing you.

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If you have a big channel. That's if you're monetized

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and you're making money, you know, you don't want to

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lose that. That's the first thing YouTube might do to

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you is demonetize your channel. Instead of just demonetizing specific videos,

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they might demonetize your entire channel, and then you've just

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lost a source of income. And then the next step

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might be they're going to take you down. There's a

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lot more to this. The article itself is short, but

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we're we're getting to that point. Where we got to

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hit a commercial break