Music in Motion: The Online Video ‘Musiconomy’

/ Nov 4, 2013

MiM

Welcome to “Music in Motion,” the latest VideoInk Special Issue. Join us this week as we embark on a deeper examination of the music space within web video. Who are the biggest players (no pun intended)? What are the biggest issues? Who should you be on the lookout for? We will cover it all. We will begin by trying to answer the following questions:

How big is music on the web?

“It’s King Kong, it’s the Super Bowl, it’s all the biggest things you can imagine rolled up into one,” says Scott Reich, vice president of programming and original content at VEVO. “Music is rivaled by only sports in having such a passionate fanbase,” he continues, “but whereas big sporting events only happen during playoff time, in music, it’s always the playoffs — there is a new hot single, video, or artist that you can discover every week.”

Superlatives aside, the man has a point. According to data in a recent “Digital Music Industry Report” by investment bank Siemer & Associates, digital music revenues will climb to $11.6 billion in 2016, after having topped $7.3 billion in 2012. This is in the face of overall music revenues, which fell from $28.7 billion in 2012 to an estimated $27.6 billion in 2013, and are expected to continue falling through 2017 as the industry takes its time adapting to “the digital revolution.” By 2017, the report predicts, digital music revenues could surpass physical music sales.

Granted, digital music can mean many things, from digital downloads to streaming services like Spotify to streaming video platforms like YouTube, Vimeo, and VEVO. So even if digital music is big, what about music in a video format?

A recent study from Pew Research found that music is one of the most popular video genres with 50% of adults now watching music videos on the web, up from 32% in 2009. As far as demographics go, music video content skews younger, with 81% of 18- to 29-year-olds watching this type of content online. If you’re wondering why music, which can easily be considered a universal genre not tied to one specific age group, is preferred by younger people online, just look at where they are watching this content.

YouTube-Music-Awards-Nominees

How big is music on YouTube?

“YouTube is the largest gathering place for kids to listen to music now,” says Larry Iser, an entertainment lawyer specializing in music and intellectual property. In fact, a study from Nielsen last year found that among the different ways to consume music, 64% of teens preferred YouTube, versus 56% who still listened to the radio, and 53% who opted for iTunes — no wonder a YouTube spokesperson told us that music ad revenue for major record labels has “more than doubled” on the site year-over-year.

YouTube declined to provide us with deeper details on the link between the site and the music industry, so we asked Tubular Labs, a provider of a YouTube analytics and marketing platform, to do some digging for us. Per its findings, the music category accounts for roughly 38.4% of total views ever recorded on YouTube. If you measure by uploads, which we also asked Tubular Labs to do, the music category accounts for 19.1% of total uploads. For proper context, remember YouTube says its users upload more than 100 hours of video to the site every minute.

On a surface level, those numbers should look insane. That’s a lot of music content. But that’s the thing, on YouTube at least, music content isn’t just about the music. In fact, going back to the Tubular Labs well, music videos account for 0.9% of views in the music genre category.

Yes, YouTube will always have “Gangnam Style” and “What Does the Fox Say?” and other viral music videos from stars like Justin Bieber to Katy Perry, which have the capacity to amass hundreds of millions (and sometimes a billion) views. But by and large, YouTube is primarily driven by user-generated content.

According to Brandon Martinez, co-founder and CEO of music-centric MCN INDMUSIC, if you’re a music label, anywhere from one-third to two-thirds of your YouTube views could be coming from user-created videos. And these can be anything from well-produced cover videos to simply a home-movie clip with a song on the soundtrack.

In fact, according to YouTube, one of the biggest trends on the music site right now is the rise of the lyric video. This year, the site’s users are uploading twice as many hours of videos tagged as “lyric videos” as they did in 2012 (over 2,000 hours in total). Overall, lyric videos have been viewed more than 665 million times so far in 2013, with spikes generally coming around major song releases.

Of course, the ability for anyone on YouTube to upload any type of content has created problems with music rights-holders (which we will address later this week), but even with those issues going on, music will continue to thrive on YouTube — partially because the site is becoming an important marketing vehicle for artists themselves.

jasonderulotylerward2

‘Mainstream’ artists need YouTube

A majority of music content on YouTube is uploaded by third parties (regular people like you and me), but a lot also comes from artists themselves. “You and me and anybody else can throw music up [on the site],” says Iser. “But I think if I’m an up-and-coming band, I would want to fully avail myself to YouTube.” Iser describes how YouTube has pretty much displaced the old ways of doing promotion, like having your song on the radio or being the musical guest on “SNL.”

“I think the line between what’s considered mainstream music and YouTube is going to get more blurred as time goes on,” says Lindsey Stirling, a violinist and performance artist whose original song “Crystallize” was the eighth most-watch video on YouTube in 2012 (and who is nominated for a YouTube Music Award for her cover video of Imagine Dragons’ “Radioactive”). “I’ve talked to a ton of ‘mainstream artists’ who are now so interested in learning how to build up their Twitter accounts and YouTube channels. It’s kind of a fun phenomenon — people are no longer creating music videos for MTV, they’re creating them for YouTube.”

It’s why Billboard and Nielsen are now incorporating “official” video views (for music videos and UGC clips using authorized audio) on YouTube into determining their weekly “Hot” rankings.

What’s more, beyond just getting their own content out there, “mainstream artists” are beginning to recognize the value of YouTube-bred talent. For example, cover songs are the most popular music category on YouTube when measured by uploads, according to Tubular. YouTube artists like Boyce Avenue, Mike Tompkins, and even to an extent Lindsey Stirling have made careers out of covering the top songs of the day (it’s a good way to latch on to what people are already talking about). And the makers of the original songs are taking note. “Jason Derulo went to a bunch of YouTubers and worked with them to do covers of his songs,” says Stirling. “It’s becoming a marketing tool to use YouTube cover songs to get more eyes for their songs.” (We will dive deeper into the cover artist phenomenon later this week, so stay tuned.)

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Why is music big on the web?

At 4.8 billion worldwide views, 1.1 billion of which come from the US, VEVO is the other big web video platform for music. Though deeply linked with YouTube, a story about music on YouTube naturally implies that we’re talking about VEVO, too.

Except that VEVO trades exclusively in the “sanctioned” aisle of the online music economy — a platform on which every piece of content is approved and professionally produced. It’s the most natural extension of what the music industry has done since MTV went live in August 1981, but adapted to meet the changes in audience viewing habits.

VEVO’s content library is dominated by music videos (over 75,000 today). But the company also produces other types of content, from concerts and live events (about 30 a year) to original music/lifestyle series (currently there are over 20 in “various stages” of development”). According to Reich, VEVO puts out 200-300 pieces of content a week across all those formats.

When it comes to distribution, Reich says VEVO wants to be wherever its audience is. “We’re not worried about trying to drive viewers to a specific place at a specific time,” he says. “It’s more about being in as many places as possible.” So it shouldn’t be that surprising when VEVO says that over 51% of the 1.1 billion views in the US have come from mobile (including tablet) and connected TV platforms.

But maybe that explains the appetite for music in a nutshell. Music is big on the web because music is big everywhere.

Photo credits: Matthew Manarino; Mashable.com; YouTube.com; RedAntler.com

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