It may be a rough and tumble negotiation game, but at least much of the argument is happening out on the street where we can all hear it (not like some industry disputes which are conducted in the back rooms where we can't). Google/YouTube is keeping the gloves off as it negotiates a new settlement (or series of deals) with the music industry, based on what it claims are realistic returns for online music video exposure.
Yesterday YouTube announced that it was going to take down all the premium music content currently available to UK YouTube users because it had failed to hammer out a new licensing deal with the UK's Performing Rights Society (PRS) for Music, a notoriously hard-line royalty collector.
YouTube said the PRS wanted more royalty payment for each video view than YouTube could ever make from the ads situated next to each.
The PRS played the innocent outrage game and expressed itself 'shocked' that YouTube could play politics with its UK viewers, depriving them of content and so on.
PRS says YouTube wanted to pay less than before, YouTube says PRS wanted it to pay more; YouTube said PRS wouldn't agree to identify which songs were to be subject to the premium content licence and which weren't. PRS said, anyway, Google made billions and could afford to pay.
In fact the latter point seems to be the crux of the PRS argument, although on that basis, the small and often barely profitable businesses the PRS hounds for playing the radio in the workplace should presumably not be required to pay anything.
If the music industry, as currently constituted, is finding it difficult to mesh with the connected world, there are nascent business models waiting in the wings and just itching to replace it. 'Tribe of noise' for instance, styles itself as a music community connecting artists fans and professionals.
This one is very much an 'open source' approach.
Files are uploaded by independent artists under the Creative Commons 3.0 license (see how that works
here) and the idea is that the music can be freely shared.
It's a simple concept - new bands and new music gets exposure and promotion, users download and use as long as they give credit where appropriate.
As the Tribeofnoise.com website points out, the old argument that recorded music requires a juicy revenue stream to pay back the costs of creation and distribution clearly no longer holds true when music can be recorded to near professional quality (multi-tracking, special effects and so on) using personal software, and sites like Tribe of Noise (and indeed YouTube) provides 'frictionless' distribution.
With all this in mind it may be that Google has decided that whatever else happens with regard to collective bargaining with the music industry, it needs to continue building innovative partnerships with specific industry players who will work enthusiastically with it - rather than work with those who moan, foot-drag and keep asking for more dosh - otherwise its own position could be flanked by others.
Just a few days ago YouTube inked a deal with Universal Music to launch what's being described as a 'premium' online music offering on YouTube, somewhat like the premium TV content site, Hulu, a joint venture between NBC Universal and News Corp.
The YouTube deal will apparently see a site called Vevo, powered by YouTube, hosting Universal Music's high end videos from its artists, including U2. The idea is that the site could be extended to other labels if it all works out well.
So the possibility is that Google is switching its strategy slightly: simultaneously playing harder ball with the music industry collectively (and chopping them off if they prove recalcitrant, as in the UK) while at the same time dangling some new business models to appeal to their strategic good sense.
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