Let me try to explain the YouTube / Content-ID situation
YouTube (or rather, their owners, Google) developed an "audio recognition" program called Content-ID, into which it invited large music publishers such as Sony, Universal, Warner Brothers etc. to submit audio recordings of all their album releases. So these companies sent their music into Content-ID, and now, every video that uses music by these companies (say, Justin Timberlake music or whatever) is automatically “detected” to include this music. As soon as the video is uploaded to YouTube, the audio in that video is scanned and compared with millions of audio recordings that they have on file. When a match is found, the person who uploaded the video to YouTube will receive a “copyright notice” in his inbox. It says something along the lines of “Your video is found to contain music copyrighted to Sony" (or which ever company). Now, advertising is put on the video. This advertising is paid for by the various companies who advertise there (obviously) and it can be anything from movies to cars to shampoos, etc in those adverts, but often times it will be an advertisement that is somehow related to the content in the video. For example, if it’s a holiday video, the advertisement could to be some kind of holiday resort. Now, YouTube obviously makes money on that advertising, and a small portion of that money is now paid out to the company who owns the music that has been detected in that video. So if the music was Sony’s, Sony are now making money on each video, and I've heard this amounts to approximately $1.00 - 1.25 for every 1,000 views that video achieves.
A side effect to this program is that the person who created the video and uploaded the video to YouTube is not able to monetize his own video. By this I mean that the video creator can't sign the video up with the YouTube partnership advertising program and receive his own advertising income from his video. Because the advertising money from that video is already “taken” by the company that owns the music that’s playing in the video.
Some people also decided that it would be a good idea to let independent musicians and bands into this whole setup. So they started Content-ID programs for independent musicians, where the aggregator (CDBaby, Rumblefish, AdShare, AdRev, IODA, The Orchard, INDMusic, Rebeat, Tunecore, AudioSparx, Magnatune, to name a few) feeds the independent music into YouTube’s Content-ID system, and starts to make money on the videos that contain this music. What happens now when people use this independent music in their videos is that they get a message from YouTube saying that their video “contains music owned by Rumblefish” (for example) and advertising starts appearing on the video. About $1 - $1.25 per 1,000 views is sent to that company (for example Rumblefish or INDMusic). Some of this is sent on to the aggregator (for example CDBaby or TuneCore), and some of this is sent on to the artist. Exactly how much is left for the artist, I'm not sure, but what started as $1.00 - $1.25 per 1,000 views has now passed through another couple of companies before it got to the artist, so it’s definitely considerably less. And now, the guy who created the video is not able to monetize his own video, because the monetization on that video is done by the Content-ID company who claims to own the music.
Another negative effect it will have on the customer’s video is that the video is actually blocked in some countries - for example, in Germany. This is because YouTube and the German royalty collection society GEMA (who control music broadcast and performance in Germany) have not reached an agreement on payments, so GEMA simply forbids YouTube to broadcast registered music in German territory. There are also some other countries that have this problem, but Germany is the most publicized one. So if you upload a video to YouTube and that video is found to contain music that is in Content-ID, the video will be blocked for all German viewers.
Content-ID clean music
This is exactly why people come to a place like Shockwave-Sound, to license music that is not in Content-ID. The music is “clean” and is not automatically recognized at YouTube. When people put our music in a video and uploads that video to YouTube, nothing special happens. The customer does not get any email with a copyright notification. The video is not automatically monetized by a third party. The video is “clean” and the customer is able to monetize his own video. He can sign the video up into the YouTube Partnership program, and he can start to receive advertising money from his video. And his video won't be blocked in any countries.
When a conflict happens
What has happened sometimes is that artists have not understood this whole setup, and they have had their music both licensed via a stock music site like ours, and also monetized via a Content-ID system through Rumblefish, CDBaby, AdShare etc. And that is a conflict.
As you can imagine, when a customer buys your a license to your music track from Shockwave-Sound and they want to use the music in a video that they wish to monetize, they upload the video to YouTube, only to be told by YouTube that their video “Contains music owned by Rumblefish”, the customer is not happy, and we here at Shockwave-Sound are definitely not happy.
- Firstly, it creates a big problem for our customer. He is likely to be angry and he will want a pretty good explanation for the music that he thought he licensed from us.
- Secondly, it makes us look very bad in front of our customer, because it looks like we are a fraudulent company trying to sell music that is owned by somebody else. A competing company, no less.
- And thirdly, the Content-ID "owner" of the music (our competitor) now actually starts to make money on our customer. We've spent years building a customer base, working our guts out day in and day out for years, and spent hundreds of thousands of dollars on Google advertising to tempt customers to our site. We finally land that customer, he buys something from us... only for the Content-ID company to “leech” onto that sale, and start to make money on our customer’s video, even though they did no work in regards to that customer, that sale, or that music. All they do is to “piggy-back” on our sale, our customer, and start to make money for absolutely nothing, other than to have allowed the independent artist to have their music in their systems.
Can Content-ID make us rich?
It is my strong opinion that independent artists will make more money on selling/licensing their music via Shockwave-Sound, than they ever will make with the Content-ID system. Unless your music “goes viral” in some crazy popular video, the money you end up with after what started as $1 - $1.25 per 1,000 views, after the money passes through one or two other companies, is hardly anything left for you. I have never heard of any artist, except for such “crazy popular” cases, that made any money worth mentioning via Content-ID. The guys I spoke with made just “pennies”. Of course, if you're Bruce Springsteen and you have your music used in 30 million videos, things will start to build up. And for the aggregators, it’s pennies from millions and millions of videos, because they have SO many artists and tracks in their database. But for one independent artist who is part of that setup, the money is likely to be almost nothing. I feel strongly that you guys will make more money by occasionally making royalties from sales via Shockwave-Sound or indeed other stock music outlets, than to receive “pennies” through a YouTube Content-ID system. But that’s up to each artist to consider, of course.
What we're saying is that you can't have it both ways. You can't ask us to sell a license to a customer to use your music track, and then also want to make money through the Content-ID system, having your music flagged as “Owned by AdShare” (or other such company) and deny the customer the chance to monetize his own video.
Sorry this turned out a little long, but this whole thing isn't a simple, straight-forward thing to explain. It’s quite a complex issue.
But if somebody "just took" our music and used it in a YouTube video, are we not entitled to any income for that?
If you find your music being used in a video, you have the right to ask (nicely) if the video uploader has a license to use that music in their video. They may claim that they don't need a license because the video is only a personal, non-profit, non-commercial video, but in fact, whether they are making money or not is beside the point. The point is that they (1) put your music to film, and (2) are distributing your music via YouTube, and both of these items are something that you are entitled to receive something for. You created the music that is helping his video, either in a financial, OR in an artistic way. You have the right to ask the customer to buy a license or compensate you in some way. We would of course like you to send the customer to Shockwave-Sound to buy a license from us, but if you wish, you can sell him a license directly (as long as you are prepared and able to give him a proper license document, which he should rightly expect when he pays you for a license).
If the video creator refuses to buy a license to your music, you have the right to issue a “Takedown notice” to YouTube. You can do that via this form: http://www.youtube.com/yt/copyright/copyright-complaint.html. Fill in details about yourself and your song. It gets passed to YouTube’s copyright dept., and the video gets taken down, unless the customer can document that he has purchased a license.
This is what you should do if you find your music in a YouTube video and you suspect that the customer has not bought a license.
But the video uploader claims to have bought the track from iTunes...
Remember, if the customer bought the music track from iTunes, Amazon and other such places that sell a track for a dollar -- or if he bought the CD in a record store -- that purchase does not include the rights to distribute the music, to Sync it to video, or to perform it through any public website, public space, broadcast, or anything like that. The iTunes / CD purchase includes only the right to personally listen to the music.
I hope this helps. It’s important for me that people understand all of this, which is why I decided to spend some time explaining it properly. Feel free to link to this article if you like; here is a permanent link directly to this article.