Music videos pulled from YouTube UK as PRS negotiations break down

Nick | 10 Mar 2009, 09:51

Thousands of music videos have been withdrawn from YouTube in the UK this week, following the break down of negotiations with PRS for Music.

PRS for Music represents a community of 60,000 musicians, collecting a paying royalties for music that’s recorded, distributed, performed or broadcast. It has been in discussions with Google over the license fee it charges for YouTube to allow its users to stream music videos.

Techradar.com reports that PRS for Music has reacted angrily:

“Google has told us they are taking this step because they wish to pay significantly less than at present to the writers of the music on which their service relies, despite the massive increase in YouTube viewing.

“This action has been taken without any consultation with PRS for Music and in the middle of negotiations between the two parties. PRS for Music has not requested Google to do this and urges them to reconsider their decision as a matter of urgency.“

The BBC reports that YouTube’s Director of Video Partnerships, Patrick Walker has described PRS for Music’s demands as"prohibitive”:

“The rate they are applying would mean we would lose significant amounts of money on every stream of a music video. It is not a reasonable rate to ask.“

YouTube’s decision is an indication of its negotating muscle in the UK market. It dominates the video streaming market globally and although it struggles in some markets (such as South Korea) against local competitors, in the UK it accounted for nearly half of the online video market in 2008.

With the collapse of Kangaroo, companies such as Microsoft, BSkyB, BT, Hulu and Joost believe this is an opportunity to challenge YouTube’s dominance.  Meanwhile the BBC has responded by developing plans for Project Canvas a platform described as Freeview Mark 2, which would deliver Hulu-style services via a set-top box, aggregating other broadcasters’ content.