In a major row over recording rights, YouTube has blocked all UK users from accessing some of its music videos.
As of the 9th of March, anyone accessing YouTube from a UK server will be denied access to all of the site's premium music videos, the result of a fallout between Google (YouTube's owners) and the Performing Rights Society.
YouTube's argument is that it's not prepared to pay the rates that the PRS wants to charge for passing onto the performers. PRS's argument is that the charges it's proposing are the absolute minimum to provide a fair deal for the artists it represents, citing that 90% of music artists would still only be earning £10,000 ($14,000) a year from the PRS's recompence.
YouTube still stands by its decision. "The more music videos YouTube streams, and the more popular those music videos are, the more money YouTube will generate to share with the PRS and its song writers. It's a win-win arrangement," said Patrick Walker, YouTube's director of video partnerships. "YouTube, however, cannot be expected to engage in a business in which it loses money every time a music video is played - that is simply not a sustainable business model."
Steve Porter, the head of the PRS, says the YouTube move "punishes British consumers and the songwriters whose interests we protect and represent."
Backing up the PRS are the Music Publishers Association (MPA) and Lord Carter, the UK's Minister for Communications, Technology and Broadcasting. Last.fm, on the other hand, has stepped up to the fight, complaining about the PRS's lack of transparency.
"It is a fundamental problem that we have been facing in that online music licensing is getting more complicated and more expensive," says Martin Stiksel, head of Last.fm, "We pay each time one user listens to a song or watches a clip and, while that is more accurate because it makes sure the more popular songs get paid more, it is also very expensive. Terrestrial radio pays a fixed minimum and that works out a lot cheaper."
The real fear is that with the licenced outlets involved in major legal battles over costs, the illegal sources, which already hold 95% of the downloads may take an unassailable position, especially with the possible demise of the RIAA.
This isn't the first company to have problems with UK licencing as services such as Pandora.com, MySpace UK and Imeem have also run into problems in the past year.