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If you’ve glanced at a royalty statement lately, you know that the new wave of streaming services, for all the feverish speculation they’ve caused, are throwing little more than chump change into the pot
—for now
ISLAND IN THE STREAM
How the Biggest Music-Streaming Service Is Hiding in Plain Sight
A ton of ink has been spilled, of late, on music-streaming services—both the radio kind (Apple’s iTunes Radio, Pandora) and the on-demand variety (Rdio, Sony’s Music Unlimited, Beats’ forthcoming Daisy, et al.). 

We’ve also heard much about Google’s ostensible leap into the streaming-music service fray with Google Play Music. But Google already owns the biggest streaming-music service in the world, one so massive it frequently goes unremarked in the digital discussion.

It’s a little thing called YouTube, and more people use it to check out music than anything else in the known universe.

You can use it to make playlists, funnel it into your car, get recommendations for related content—pretty much everything you can do with any of the sub services prompting so much chatter these days.

Everything’s there, plus remixes and live versions and covers and mash-ups and renditions cobbled together from speeches by President Obama. You can also use it to watch clips of kitties falling off pianos.

YouTube makes an assload of money from advertising, and the bulk of that from music videos. After all, your average kitty-makes-a-funny-noise clip lasts less than a minute. But in the three-to-four-minute duration of a typical song, advertisers get serious exposure.

So how much dough is going to rights holders from this mighty digital force, apart from that generated by the discrete, highly profitable, label-owned VEVO channels? Well, here’s a video of some crickets.

That may change somewhat when Google rolls out its planned subscription video service, which will presumably offer a better, less cluttered (and ad-free) YouTube experience. We shall see how such temptations fare against the cost-free and familiar old version.

Speaking of VEVO, talks continue between the video giant’s label-group owners and suitor the Guggenheim Group; the size of that proposed deal—rumored to be between nine and ten figures, with labels retaining participation—is an indicator of how much cheddar VEVO generates.

That said, the licensing of major-label music on YouTube is subject to the terms of the VEVO-Google deal; if VEVO does an exclusive deal elsewhere, the licenses will expire--and YouTube will  lose a significant source of traffic.

If you’ve glanced at a royalty statement lately, you know that the new wave of streaming services, for all the feverish speculation they’ve caused, are throwing little more than chump change into the pot—for now. That’s no reason to think they won’t make a substantial contribution in the future; after all, a lot of our readers once swore nobody would ever want to listen to music on a computer.

But in the here and now, it’s important to remember that Google already has the biggest streaming outlet in existence. The question is how to take all that traffic and end up with a little more in the kitty.

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