How many views does it take to make money on YouTube? This is a common question asked and it really depends on who you ask. You may have heard that you’ll make one dollar per thousand views or that it’s $1,000 per Million Views. Some say it’s $5 per thousand views. If you take the Youtube video “Africa” by Toto which has been viewed over a 102 million times, Youtube has paid out to the label between $102,000 and $510,000 again, depending on whose accounting method you subscribe to.
Without getting into all the technical details here, the real question we should be asking, “How much ENGAGEMENT does it take to make money on YouTube?”
You don’t make money based on the amount of views you have. You make money based on people’s engagement with the ad. Engagement here means clicking or watching a ad for more than 30 seconds. YouTube Advertising is managed in the Adwords platform. Advertisers choose ads on a Cost Per Click (CPC) or Cost Per View (CPV) model.
Like any new platform, YouTube has its share of critics from labels and artists.
While YouTube ignores major label criticism, anger amongst the artist community over royalties paid out by the video giant is steadily getting louder every day.
Last month, Katy Perry, Deadmau5, Fifth Harmony, Christina Aguilera, Cee Lo Green, Garth Brooks, Jon Bon Jovi, Lionel Richie, Steven Tyler, Pete Townshend, Rod Stewart and Elvis Costello all signed a petition to reform the DMCA (Digital Millennium Copyright Act) in the US, commenting that the current legislation “threatens the continued viability of songwriters and recording artists to survive from the creation of music”.
Their target: the ‘safe harbor’ provisions contained in the DMCA, which enable sites such as YouTube not to be held legally responsible for copyright infringement taking place on the platform.
The threat of a sea of unlicensed music content existing on YouTube appears to work strongly in Google’s favor when it comes to negotiating licensing deals with music rights holders like the major labels.
The artist group’s letter, filed with the US Copyright office on March 31, was also co-signed by Barry Manilow, Bryan Adams, the estate of Count Basie, Bootsy Collins, Mick Fleetwood, Babyface, John Mayer, Pearl Jam and Bernie Taupin. It warned: “Music consumption has skyrocketed, but the monies generated by individual writers and artists for that consumption has plummeted.”
Now, both Blondie’s Debbie Harry and Mötley Crue’s Nikki Sixx have added their names to a growing throng of artists raising public concerns over safe harbor, and its corrosive effect on artist payments from digital services.
According to the New York Post, Harry will this week to urge President Barack Obama to issue an executive order to ‘close the so-called safe harbor loophole’.
And Sixx, now fronting band Sixx:AM as well as a successful career as a music radio DJ, has urged YouTube to “do the right thing” over artist royalty payouts.
“YouTube is paying out about a sixth of what Spotify and Apple pay artists,” Sixx told the Guardian. “We are not telling them how to run their business. We’re saying treat artists fairly the way other streaming services are. And by the way, we are a big part of what built your business: music is the No 1 most-searched thing on YouTube.” He added: “They’re hiding behind this safe-harbor loophole. That is allowing them the freedom to not take care of artists.”
Last year, Taylor Swift lambasted Apple Music in an open letter for its decision not to pay artist royalties during its free trial period. As a direct result, Apple’s Eddy Cue personally reversed the policy, publicly apologizing to Swift and her fellow musicians.
Due to safe harbor, it is currently incumbent on managers and labels to file individual takedown notices with Google-owned YouTube for videos that infringe on artists’ copyright.
YouTube argues that its Content ID system has been “built to ensure that record labels, managers and others don’t only have to rely on DMCA notice-and-takedown tactics to get infringing content removed”, claiming that since January 2014, over 98% of all YouTube copyright removal claims have come through Content ID.
YouTube told the US Copyright Office earlier this month that the argument the DMCA has directly resulted in a ‘value gap’ hurting artists and labels is ‘completely false’.Music Business Worldwide
Irving Azoff a noted music artist manager (derided in Hollywood as the “Poison Dwarf” because of his size and demeanor) has written an open letter to YouTube in which he accuses the video service of paying artists “a pittance” and failing to care about music. He says that Taylor Swift ought to choose whether or not her music is streamed for free. If music matters to YouTube, then why not give musicians the same choice you give yourselves? Taylor Swift should be able to decide which of her songs are available for free, and which are part of a paid subscription service. Or she should be able to opt out of YouTube if you won’t give her this choice. Azoff’s letter, posted on Re/code, carries a great deal of weight, his impressive client list encompassing Christina Aguilera, the Eagles, Van Halen, Steely Dan, Maroon 5, Bon Jovi and more …
The letter was in response to a YouTube blog post in which the Google-owned company said that ‘musicians and songwriters matter [and] deserve to be compensated fairly’ and that it took copyright seriously. Azoff disagrees, accusing the company of protecting its own content but not that of musicians. If YouTube valued music, then it would allow artists to have the same control which YouTube grants to itself. YouTube has created original programming. Those programs sit behind a “paid wall” and are not accessible for free unless YouTube decides to make them available that way. If a fan wants to watch the YouTube series “Sister-Zoned,” that fan has to subscribe to YouTube Red for $9.99 a month. But the same does not apply to music.
The lengthy letter argues that YouTube hides behind ‘safe harbor’ laws that mean it is not expected to prevent copyright breaches, only respond to takedown notices. Artists accept the small payments YouTube offers because they know they can’t prevent their music from appearing there. YouTube has benefitted from the unfair advantage which safe harbors gives you: Labels can take the deals you offer or engage in an impossible, expensive game of “whack a mole,” while the music they control is still being exploited without any compensation. This, he suggests, is why Spotify and Apple Music are ‘better partners’ to music creators.
My two cents: As an artist manager, I of course will side with the artist and do my best to see they are treated fairly. I also want to make sure that their fans are treated fairly as well and don’t get penalized in the future for what is now free to them on YouTube. It is a good bargain for any advertiser and in my opinion the “heavy lifting” or support should be on the advertiser’s back, not the the artist or their label. The Artist and the label have plenty of expenses such as producing a high quality video and then pointing (marketing) to fans for the YouTube sites.
Steaming and digital downloads in today’s music industry are now just some revenue streams that can trickle in, especially for a new artist, but the marketing of the artist or artist’s “brand” is invaluable on YouTube. If you are lucky enough to score a few movie sync tracks too, all the better. But the real money is in the live performance now more than ever. Ask Garth or Adele