File-Sharing Websites May Be Required By EU To Make Deals With Music Industry

Hi-Tech Silvia Meyer
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The European Union is stepping in to make some potential changes to the music industry. Latest reports state that Pinterest, Daily Motion, and YouTube may be forced to create licensing deals or revenue-sharing contracts with artists for their content as it is uploaded by individual users. This is addressing a long-standing complaint of the music industry claiming that their artists don’t receive enough financial remuneration for their music, despite the ad-supported content.

The EU is considering imposing rules for each platform that hosts user-uploaded content. Each medium would have to maintain a mutually beneficial contract with the creators of such works that was equitable with the economic value of works as protected files. This agreement may be in the form of a monetization agreement that shares revenue or it may be a copyright license. The former is already popular so it may be the easiest to implement.

The EU also wants file sharing companies to institute appropriate measures to ensure that the agreements between creators and viewers are functioning properly. The final methods of how the agreements will be planned out are still up for discussion.

Google executives reported that YouTube generates over $2-billion for all its rights holders by creating licensing agreements with both publishing companies and music labels. The company has content IDs for each piece they have available, and they give those rights holders the option of leaving their videos up, monetizing them or blocking them through the deal.

Rights holders have complaints, though—they believe that the current licensing does not allow them enough bargaining power with their original works. Google declined to comment at this time. The music industry as a whole, however, states that the content ID method does not provide them with enough revenue as it is set up currently.