Youtube's Neil Mohan urges the music industry to revalue ads' role

Youtube's Neil Mohan urges the music industry to revalue ads' role

While much is being debated about the effects and the alleged injustice and damages caused to the music industry by the DMCA and all 'safe harbour' driven principles and practices, hence having all guns aimed at Youtube, Google's video platform's  chief product officer Naeil Mohan quietly suggests labels to embrace a more optimistic approach to online advertising, revaluing its role as a promosing income and profit driver in the long run.

Signing an op ed on Billboard last week, Mohan wrote: "The consensus surrounding the music industry seems to be that its glory days are over. First beset by piracy and now unsettled by digital distribution, few people believe the industry can return to the heights it reached when it earned nearly $ 39 billion a year. But I believe the industry's future is actually brighter than ever, if it's willing to embrace something that's made the internet a profitable place for millions of companies and content creators: ads.

I've spent most of my career in digital advertising, watching it transform from an idea into a multi-billion dollar industry within just two decades. I've seen the way it has become a growing and reliable source of revenue for content creators of all kinds -- Google shared over $10 billion of ad revenue to content creators across the internet in just the last year..... It's easy to dismiss ad-supported models today while digital streaming is still small and relatively new. Radio, which has been around for nearly 100 years, commands a 26 percent market share; streaming video only accounts for eight percent of music consumption today......But ads are already generating billions of dollars for the music industry (over $3B from YouTube alone). While the recent concerns artists have made about the copyright safe harbor reflect a fear of losing money from ad-supported streaming, the truth is, it is a new source of revenue that is poised to dramatically increase. As digital consumption grows and more print, radio and TV advertising dollars shift online, the music industry has a chance to reap a massive windfall.....Why am I so optimistic? Mainly because the music industry has largely solved the problems that online content creators have grappled with for years....The industry now has a fantastic opportunity to earn revenue from these casual fans thanks to digital advertising. Unlike radio, ad-supported digital services like the free tiers of Pandora, Spotify, SoundCloud and YouTube pay out the majority of their ad revenue to labels, publishers and artists, which means they only earn revenue when their partners do. Yes, that shift will take time, but it's already begun"

 

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