Lyor Cohen: YouTube's Rocky Past With Music Industry Is Over

Lyor Cohen

To hear Lyor Cohen tell it, the long-running conflict over music licensing between YouTube and the major record labels is over.

"We're now starting to have real connective tissue," said Cohen, YouTube's global head of music who was in San Francisco promoting the upcoming launch of YouTube's latest subscription music service. "We're working together in building these products."

That's a big statement. For the past two years, leading up to the recent licensing negotiations, the music industry has routinely labeled YouTube as an enemy of recording artists. Music videos helped turn YouTube into an entertainment juggernaut, but in return the world's largest video-sharing site paid peanuts to artists, or at least that was how the record companies saw things.

But that was before the top three labels, Universal Music Group, Sony Music and Warner Music Group completed licensing deals earlier this year with YouTube. Far fewer complaints are coming out of the record companies now, and Cohen said the improved relationship is about more than just money.

According to him, Spotify and Apple Music, the top two subscription services, frighten record executives far more than YouTube does.

"Forget the past," Cohen told BusinessInsider on Friday.

He said that YouTube is now "working in collaboration with the industry because the industry is terrified that this could be a two-horse race" between Apple and Spotify. The music industry thinks partnering with YouTube to distribute music could prevent such a duopoly, he said.

The suggestion is that Spotify and Apple Music pose a threat to the labels. Should they obtain too much power over the distribution, they could, presumably, dictate terms to the record companies.