What 2 Billion Missing YouTube Views Says About the Music Industry

By Keith Nelson Jr.

You gave [Steve Jobs] your music.What’s to say you couldn’t have did that yourself? It’s just a website…

Do you know how much of a hustle that is? All he has to do is have the site running and he make money. [The artists] supply the content. The record labels gave that away to him for free.

-Gimel Androus Keaton aka Young Guru (Legendary engineer of Jay-Z) in HipHopGameTV interview

Quick history recap: In April of 2003, the iTunes Store opened. In 2005 three guys leave PayPal and start YouTube. In April of 2008, the iTunes Store surpassed Walmart as the number one music retailer in the United States. In December of 2009, Sony Music Entertainment and Universal Music Group (with investment stake by Abu Dhabi Media) started video hosting site VEVO. In December of 2012, YouTube removed over 1.8 billion YouTube views from Sony and Universal artists’ videos.

The recent removal of views received an initial outcry of unethical view manipulation on the part of the major record labels. While labels do have a history of manipulating music charts, this move is more business than ethics and essentially boils down to not wanting to go past “fool me once.”

A YouTube spokesman informed Billboard that it has recently implemented a digital Spring cleaning, removing videos that are no longer live on the site, (deemed “dead videos). Dead videos were the overwhelming majority of the views removed with only 1.3 million of those views generated from bots. Additionally, an unnamed “senior label executive” confirmed to Billboard that such a migration has been in motion.

But in an age where digital music consumption is king, why would record labels migrate from the third most viewed site on the internet, according to Alexa?

The do-it-yourself logic of Young Guru’s headline quotes began truly manifesting in July of 2012 when Doug Morris, the head of Sony Music told LATimes.com that Google’s fees would be a catalyst to a VEVO migration. There are no official reports of the exact compensation percentage details between YouTube and VEVO’s agreement, however, it is reported that YouTube charges 40% of ad revenue as a “platform fee” to each of its partners. Interesting fact: VEVO’s YouTube channel generated over 50.6 million views in November of 2012 and was the most watched channel on YouTube for many months prior, according to Comscore.

The “machine” is learning the machine.

Record labels are further investing in the business of aggregating content to transport and reimagine the traditional advertising method. Rumors of a Facebook-VEVO partnership were sporadic throughout 2012 and attained a modicum of veracity in March when VEVO required its users to login with their Facebook accounts. In October of 2012, Facebook attracted over 160 million unique visitors yet barely over 47 million of those visitors were viewing Facebook video content. With VEVO’s recent migration developing in the middle of a Google and Facebook battle for social media supremacy, the disappearance of YouTube views is indicative of the appearance of a new dynamic in the music industry and interwebs.

Stay watching, people.