All-new subscription service YouTube Red will launch this Wednesday in the US (October 28).
As MBW covered last week, it could be a real game-changer for the adoption of paid-for streaming services – especially as Google Play subscribers will get all of Red’s benefits for free.
But that doesn’t mean everyone’s on board.
YouTube has asked video content rightsholders to sign a new licensing deal, covering both YouTube Red and its traditional ad-supported version of the platform.
This contract stipulates, amongst other things, that rights-holders will receive 55% of net revenues from video and display advertising. (You can read the full contract here.)
However, if rights-holders choose not to accept these terms, YouTube warns it will ‘hide’ their videos from both the paid and free versions of the platform.
Labels were given until last Thursday (October 22) to sign up. They were told: “If you haven’t signed by this date, your videos will no longer be available for public display or monetisation in the United States.”
“If you haven’t signed… your videos will no longer be available for public display or monetisation in the United States.”
YouTube email to rightsholders
According to YouTube, rights-holders responsible for 2% of total watch time on the service still haven’t agreed terms.
Although independent label commercial rep Merlin has signed the new contract, MBW understands that some independent labels continue to reject YouTube’s terms and refuse to approve it.
On Friday (October 23), the Google-owned video giant sent the below message, obtained by MBW, to these remaining hold-outs.
Next week we are launching YouTube Red in the United States, a YouTube membership for a monthly fee to give our fans more choice in how they enjoy their favorite videos.
YouTube Red will also create a new source of revenue for you that will supplement your advertising revenue.
An overwhelming majority of our partners — representing over 98% of YouTube Watch Time — have signed up and will participate in this new paid membership.
We want to ensure that fans who choose to become paid members can watch all the same videos that are available on the ad-supported experience. This is why we’ve been working so hard to update all of our agreements over the last six months.
Because your agreement is now outdated, the videos associated with your YouTube channel are no longer available for monetization in the United States, where we are launching YouTube Red.
At any time, you can re-enable monetization by navigating to your Features page. If you have questions or encounter technical difficulties, we’re here to help: reach out to us for support here. Common FAQs can be found here.
We are confident that YouTube Red will excite your fans and generate an additional source of revenue for you.
The YouTube TeamMusic Business Worldwide