14 DAY TRIAL // It’s not that much piracy that is affecting the music world, but rather YouTube. A brand new study indicates that the popular video streaming site is the reason why record labels lose millions of dollars each year.
Researchers from Fairfield University and the University of Colorado have examined the effects of Warner Music’s YouTube blackout from 2009 on the label’s sales, TorrentFreak reports.
The music was pulled from YouTube due to a licensing issue, but this eventually meant that more money was made out of selling albums. The researchers compared the sales of artists signed with Warner who had made it into the Billboard Album 200, to those from labels that still allowed their music to be present on YouTube.
“We showed that the removal of content from YouTube had a causal impact on album sales by upwards of on average 10,000 units per week for top albums,” reads the study. Furthermore, for top artists, YouTube is not always a promotional tool.
Instead, the site does have a big role in discovering new artists and music, indicating that it might be a better idea to pick other promotional methods for the A-listers of the music industry.
In fact, rough estimates indicate losses of $1 million per year for the top albums promoted on YouTube. Assuming that Warner indicated that it had some 40 albums on Billboard 200 for a year, the total lost sales rise up to $40 million, which is a lot more impressive.
“We find that the sales displacement effect is initially substantial although it falls into insignificance if we drop, say, the top 50 albums. For instance, using a six-month window before and after the blackout, the removal of content from YouTube is causally associated with an increase of 7375 units per week per album using the top 200 sample, 3155 units dropping top 10 albums, 1968 units dropping top 25 albums, and 555 units dropping top 50 albums,” the study shows.
Basically, the fact that people have easy access to entire albums online will drive them not to pay for the music. Of course, this could be entirely the artist’s fault since music found online should in fact entice fans to buy an album.
If they get to listen to it online and find it sub-par, then they will not bother acquiring a copy of their own. The same can be said about music piracy, especially since studies have indicated that those who pirate more content actually spend more money on movies, games and music than those who always go to the store.