Google Cutting Funds to Illegal Websites Opens New Possibilities for the Digital Music Industry in MENA
This article is courtesy of Yala. Yala is the place to play, download and share unlimited music for free across all devices. Yala Music, its founding company, takes a stand against piracy by signing up with 450 independent artists and major labels from MENA and abroad. The service is accessible on the web at yala.fm and Yala apps can be downloaded for free virtually everywhere.
Last week The Telegraph reported that Google was intending to take drastic action to cut piracy. To tackle the problem at the source, the tech giant announced that it would address payment companies such as Paypal, Visa and Mastercard, and ask them to stop providing payment processing facilities for illegal websites. This initiative is part of a global plan by Google which also includes mass banning of AdWords advertisers on pirate sites.
According to the English newspaper “Executives want to stop websites, more or less dedicated to offering links to pirated films, music and books, from making money out of the illegal material. These plans, still in discussion, would also block funding to websites that do not respond to legal challenges, for example because they are offshore.”
In a region like MENA, where piracy accounts for the vast majority of online music consumption, these actions could have ground breaking effects.
On the bright side, shutting finances to illegal websites could very well provide an efficient way of suffocating them and generating traffic to legal alternatives. But it could also have unexpected repercussions for the online advertising industry.
Indeed with 45 million unique monthly visitors on pirated websites within the 22 countries of MENA alone, illegal websites represent a large chunk of advertisers’ inventory. As measures to control piracy toughen, the demand for alternative advertising models linked to creative content that are legal may also increase.
Creative companies who strive to monetize their products with advertising could therefore indirectly benefit from these anti-piracy measures. Models such as Youtube’s pre-roll ads, Spotify’s free ad-funded streaming available on the web, or Yala Music’s advertising-sponsored download, create opportunities for advertisers to target music fans while providing a revenue share to the rights-holder. Such models have already inspired influential advertisers like Pepsi, who recently signed an agreement with Yala Music, to buy 20 second video banners on yala.fm and Yala mobile apps, as part of a larger campaign built around music.
Another solution for these pirate websites could be to legalize their content. However, as the Napster case showed a few years ago, transitioning from free content to a paid model is fraught with difficulty. To make this transition smoother, Yala Music has initiated a discussion with some of the pirate websites to link their content to the company’s existing ad-sponsored download service, allowing them to become legal without charging the end-user.
If initiatives such as these continue to develop, advertisers, labels and music services could see a dramatic increase in revenue while helping to reduce piracy at the same time.
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