YouTube Closes In On Spotify As Top Music Streamer

Spotify is the king of music streaming — but its lead is dwindling. 

Billboard reports YouTube generated over $6 billion to the music industry in the 12 months ended June 2022, the company announced Tuesday (Sept. 13). That was a 50% increase from the last figure YouTube reported, $4 billion over a 12-month period, in June 2020.

Reaching the $6 billion milestone raises the question of when — if at all — YouTube might surpass Spotify in terms of value to rights holders and creators. “We want our twin engine of ads and subscriptions to be the #1 contributor of revenue to the industry by 2025,” wrote Lyor Cohen, YouTube’s global head of music, in a blog post on Tuesday.

That won’t be easy, but it isn’t impossible, according to Glenn People at Billboard. Consider how fast YouTube has grown since Cohen joined the company in 2016 from 300 Entertainment, the label he co-founded after his tenure as chairman and CEO of recorded music at Warner Music Group.

YouTube Music reached 30 million subscribers in October 2020 and announced the 50-million subscriber in September 2021 — a 67% increase worth 20 million subscribers in less than a year. In 2017, a year before YouTube Music launched, the company’s two music streaming platforms — Google Play and YouTube Red — had a combined 5 million subscribers, Billboard reported at the time. YouTube’s announcement Tuesday did not include an update on its subscriber count for YouTube Music.

Spotify has handily maintained its lead over YouTube, Apple Music and Amazon Music in numbers of subscribers. Over roughly the same time YouTube added 20 million subscribers (the third quarter of 2020 to the third quarter of 2021) Spotify added 28 million subscribers, to 172 million, and finished the second quarter of 2022 with 188 million. It’s still pushing hard, too, betting big on podcasts and audiobooks to bring in more customers.

But YouTube has the benefit of being the planet’s de facto source for video content. With 2.6 billion monthly users as of January 2022, according to Statista, YouTube ranks behind only Facebook in global audience size. That massive footprint gives YouTube an opportunity to monetize free users through advertising and convert some small percentage of users into paying customers. YouTube goes a step beyond other music streaming platforms by monetizing a range of music videos: short- and long-form videos, live videos and audio-only tracks. User-generated content accounted for 30% of royalties paid to the music industry — the same proportion as its June 2021 announcement.