I know, it’s confusing, but bear with me. Here’s what happened so far: GEMA, which represents recording artists as well as publishers, wants YouTube to pay a fee for each and every video viewed on the site that contains music of one of the artists represented by GEMA (which include every major label artist, as well as most indies). YouTube has rejected that approach, and instead wants to pay a percentage of the ad revenue it makes with those videos.

Negotiations between both parties broke down in 2010, and GEMA asked YouTube to block videos containing music of some 600 artists. YouTube responded by blocking a wide range of videos, telling users that these videos are “unfortunately not available in Germany” because they could contain music for which GEMA hadn’t granted the rights to YouTube.

GEMA officials have long complained that this wasn’t true, suggesting instead that YouTube simply didn’t pay for licenses to these rights. Of course, the licenses that YouTube is offering are based on the rates that YouTube is challenging, so it’s pretty much semantics and fingerpointing.

Except, most users are upset about GEMA, and the group apparently doesn’t want to shoulder all the blame anymore. GEMA’s CEO Harald Heker told local paper Wirtschaftswoche that YouTube’s handling of the blocking is “pure demagogy.”

A YouTube spokesperson sent me the following comment about the lawsuit:

“YouTube believes that rights holders and artists should benefit from their work. We have dozens of collection society deals in place across more than 40 countries because we provide an important source of income for musicians and a platform where new artists can be discovered and promoted. We are open for negotiations to find a solution with GEMA compatible with YouTube’s business model so that we can again provide a source of revenue for musicians and a vibrant platform for music lovers in Germany.”

So there you have it. Each side wants to sound completely reasonable as, all the while, the actual licensing dispute drags out further and further. At this point, it’s pretty unlikely that German YouTube users are going to get access to their music videos any time soon.

Image courtesy of Flickr user  nyghtowl.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• How consumer media will change in 2013
• Controversy, courtrooms and the cloud in Q1
• Players and Strategies for Real-Time In-Stream Advertising

The problem is that most things are in silos and there’s precious little in the way of cross-platform continuity for the listener. Which is why Musicplayr, a Berlin/Cologne-based service that offers just that for most free online music, sounds pretty good right now.

Musicplayr users can pull in content from all sorts of free music platforms, both audio and video, to create a unified playlist. The site’s player is itself embeddable, and on Thursday it got a whole lot prettier: audio-only tracks now get accompanying pictures, and the player window can also now be continuously visible. The startup calls it “eye candy for the ears”.

If you want to run off and check it out before reading further, fire off an email to gigaom@musicplayr.com – the first 200 to do so will get an invite. Yes, it’s not entirely open at the moment, but those who are already in can invite others.

“Technically we only store the deep links – we are not altering or caching this content,” co-founder Thorsten Lüttger told me. “We want to make all three parties happy – one party is the consumers, the others are the labels and the producers-slash-artists. All of them have to be happy. The content owner stays in control.”

Avoiding the GEMA trap

The legality of Musicplayr’s approach has been a careful consideration for Lüttger and co-founder Stefan Vosskötter. However, one party Musicplayr hasn’t even bothered approaching is Germany’s much-loathed music rights collection society, GEMA, a.k.a. the organisation that broke YouTube for Germans. As far as Lüttger is concerned, it doesn’t matter too much what GEMA makes of the startup’s business model when the company is thinking about being a global product.

“We can build this model without Germany as well,” he said. “Technically we are a bookmark service – what we are doing is open. The songs GEMA has taken down from YouTube we [automatically] do not play in Germany, but the moment you cross the border into the Netherlands, we play it for you. It’s something where the German consumer has to suffer and it’s not our mission to solve this problem. It has to be solved between GEMA and those providers; we’re just the middleman.”

Brave words. So if Germany’s not necessarily Musicplayr’s main focus, where is? Western Europe and the U.S., apparently. Lüttger believes services such Spotify, which also offers an embeddable player, have given people a taste of the idea already.

However, he pointed out that Spotify’s player is “basically a download link to their app”, whereas people listening to someone’s embedded Musicplayr don’t need to download anything.

“I believe Spotify is opening up people’s minds that you do not need to own music. This all-you-can-eat flat rate is awesome, and I’m glad they’re successful,” he said. “We are going even further, because we help you archive all freely available content.”

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Monetizing music in the post-scarcity age
• The evolution of consumer-media cloud storage
• Controversy, courtrooms and the cloud in Q1

But understanding what exactly it’s trying to find a solution for takes some explaining — largely because the suit appears to have been more of a negotiating tactic than anything else. One thing’s for sure: it doesn’t make YouTube any less broken in Germany, for now at least.

Here’s how it all started.

In 2010, GEMA and YouTube were trying to negotiate how much YouTube should pay in royalties for the copyrighted music videos on the platform. YouTube was willing to cough up 10.25 percent of the net ad revenue it generated in Germany, which GEMA would then (mostly) redistribute to the artists.

However, GEMA also wanted a whopping 12 euro cents ($0.16) per stream. Google said no, GEMA sued, the negotiations were abandoned and, as a result, most major-label videos have been blocked on YouTube Germany for the last two years.

The suit was a test case, covering 12 copyrighted songs — five of which were dropped from the case early on — that had been uploaded to YouTube without the rights holders’ permission. On Friday, the Hamburg regional court said YouTube had to take the remaining seven songs down, but it also imposed certain future conditions on the platform.

In future, the court said, YouTube has to check all titles and descriptions for uploaded videos to see whether they might be for copyrighted material.

But now here comes the weird bit: the court also wants YouTube to use its own Content ID system to flag up videos that are copies of copyrighted material, whether or not rightsholders have complained.

That’s an inversion of the current system, which relies on rights holders uploading their own content to the system so that it can create digital fingerprints to recognize copies so that they can be either blocked or monetized. Now YouTube is supposed to monitor this stuff itself and decide whether there is infringement, rather than let the owners take responsibility.

We have already said this is not possible because we don’t know exactly what rights GEMA has for all the music content,” YouTube spokeswoman Mounira Latrache told me. “This is against any platform which uses user-generated content.”

Keyword filtering is also a lousy idea, Latrache said, because it frequently results in false positives. “It would be a bad solution for the musicians themselves because it would block things that were not meant to be blocked,” she said.

Of course, GEMA thinks the result was great.

“We reached our primary goal one hundred percent, to have the court confirm that YouTube is fundamentally responsible for videos posted by users,” GEMA chairman Harald Heker said.

(Conversely, Google points out that the verdict defined YouTube as a hosting provider not a content provider, which actually makes it less liable for everything that goes on on its platform.)

Heker also said in a Monday interview with Der Spiegel that “YouTube will either introduce these safeguards on its own, or finally sit down with us again at the negotiating table, so we can conclude a clean contract.”

Nobody wins

So what happens now? Hard to tell. Google can appeal, and probably will, although it’s not given any indication of this yet.

GEMA dropped its maximum per-stream charge to 0.6 euro cents last December, and it still wants that 10.25 percent ad revenue cut as well. Google says the 0.6c rate came from negotiations with download services such as iTunes, making it inappropriate for YouTube.

“We have to speak to GEMA again, but we don’t agree on the 0.6c because it’s far too high and does not fit with our business model because we’re not a download provider,” Latrache told me.

At least negotiations can resume now that the suit’s over (if it really is over), but it doesn’t look like anybody’s willing to budge yet. The result? Germans shun their broken YouTube for licensed rival services, or turn to semi-legal proxies to unblock its videos.

You couldn’t find a more perfect example of the copyright-vs-technology dilemma, and the capacity of everyone involved to shoot themselves in the foot, if you tried.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Google and the Ghost of Silicon Valley Past
• How consumer media will change in 2013
• Examining the rise of crowd labor platforms in 2012

GEMA President Harald Heker said during the association’s annual press conference that negotiations with Spotify are still ongoing, with a final meeting scheduled for March 26.

“I’m pretty optimistic that we will find common ground,” he was quoted as saying by the German IT news site Netzwelt.de. However, Heker also clarified: “We don’t have a contract with Spotify, which means we also don’t have a preliminary agreement.”

Spotify acknowledged that fact by telling local press that it continues to negotiate with GEMA.

To be fair, this isn’t the first time that a music service launched in Germany without settling all the details with GEMA. Many years ago, Universal Music launched its own download service — dubbed Popfile — in the country without any contract with the rights holders group. But being at odds with GEMA can also lead to lots of trouble: Negotiations between the group and YouTube over licenses for music videos broke down two years ago, and numerous music videos have been blocked in Germany ever since.

It’s unlikely that things will escalate to that level between GEMA and Spotify. Heker told press this week that Spotify has demonstrated it is willing to play by the rules, according to Netzwelt. However, the exact interpretation of those rules could decide how long Germans will be able to enjoy those free plays on Spotify: GEMA’s standard rates call for payments of up to 0.006 Euro per song played – an expensive proposition for any music service that offers up songs for free.

Update: Spotify got back to us with this statement: “Spotify offers a legal service in Germany. We are in ongoing discussions with GEMA to formalise a long-term agreement. We are paying composers and lyricists in Germany, just as we pay composers and lyricists in all other countries in which we operate.”

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Monetizing music in the post-scarcity age
• The evolution of consumer-media cloud storage
• Controversy, courtrooms and the cloud in Q1

Tape.tv is essentially an online TV station with a few genre-specific sub-channels: think alternative, hip-hop and indie. They’re all filled with traditional music video content — there’s nothing user-generated here — but it does let the user like or dislike the videos they’re shown, which in turn allows the service to gradually customise what each viewer sees to their own tastes. In other words, it’s like Pandora for video.

The Berlin-based company has been going for around four years, collecting a catalogue of 45,000 videos and around 3.5 million users along the way, which is good work if you consider it’s only available in Germany, Switzerland and Austria.

So why just Germany?

I caught up with Tape.tv a couple of weeks ago and picked up three reasons why they haven’t expanded further yet. The first is language – it’s only in German now, of course – and the second is the need to work out licensing rights in each territory.

The third, though, is that Tape.tv wants to have an editorial team in each region. Sure, the YouTube age may have put editorial power in the hands of the user, but this team is taking an approach that’s something of a return to the curated experience of TV.

Which is where strategies like the intriguingly gamified Spotify app come in. The app doesn’t play videos inside the client (as you might expect) but instead presents a series of daily stories that let the user choose the ending. The chosen ending triggers one of two playlists, and for each track the user can choose to click through to watch the video on Tape.tv’s site.

It’s a novel use of the platform. But don’t be fooled by the cute idea: Tape.tv is a very serious company, with 85 employees, many of whom are in sales, and ambitious plans.

The site already does big ad deals around video premieres for the likes of Lady Gaga and Rihanna, and has branched out to real TV with a ‘social music program’ on the ZDFkultur channel.

And it wants to expand. Once those language, licensing and editorial issues have been ironed out, the company tells me, the UK will be the first country to get the service in non-German form — and expect that rollout to come within the next few months.

Licensing loopholes

It’s very interesting to see someone aim for the space that the old, pre-reality-dreck MTV created and abandoned, but there’s another interesting story hidden underneath the hood.

We’d love to know what arrangement Tape.tv has with GEMA, Germany’s notoriously hardboiled music rights collection society and the organization responsible for effectively breaking YouTube in the country. After all, the more interactive a music stream is, the more GEMA charges for it.

However, while Tape.tv does include some on-demand functionality, via search and mixtape creation, its main thrust is the sit-back-and-relax TV channel format. Tape.tv won’t go into the details of its GEMA arrangement, although CEO Conrad Fritzsch did hint to Der Spiegel last month that the site was “no classical on-demand portal”. This may suggest that the company gets away with paying GEMA less than it would if it were a fully YouTube-like interactive service.

We’ve already seen Berlin’s Wahwah.fm aim to recreate the linear radio-station model for smartphones as a strategy that is designed specifically to work around GEMA’s more onerous pricing levels.

Perhaps the collection society has inspired a trend away from interactivity. If it has, the users seem to like it.

Sometimes licensing moves in mysterious ways.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Connected Consumer Q2: Digital music meets the cloud; e-book growth explodes
• Controversy, courtrooms and the cloud in Q1
• Monetizing music in the post-scarcity age

She recorded a YouTube video to highlight the issue, pointing out that she has signed contracts with music publishers that give her worldwide rights to the music used in the movie. Check out the entire video below:

Paley’s rant is just the latest instance of rights holders and music fans getting upset about the dispute between YouTube and Gema, which has been escalating ever since negotiations between the two parties broke down in early 2010. The main issue at hand is that Gema would like a per-play compensation for the use of its works, but YouTube instead wants to pay a percentage of ad revenue earned with the videos in question.

Further complicating the issue is that copyright isn’t the same worldwide. U.S. laws make complete buy-outs of rights possible, meaning that rights holders can opt out of pool licensing of public performances and mechanical reproductions for a lump sum of upfront money. European intellectual property rights generally don’t allow this kind of thing.

A Gema spokesperson blamed Google for the video not being available to German users when contacted by us via email. “Gema didn’t order the blocking or ‘censorship’ of this movie,” she wrote, adding that Google distorted the situation by suggesting that Gema didn’t offer the rights to display certain content. “YouTube simply hasn’t acquired these rights,” she wrote.

Regardless of who is at fault for this latest incident, it looks like Gema is increasingly losing the war of public perception. Question is, will that make it easier or harder to come to an agreement?

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Report: The Live-Stream Video Market
• Who and what to watch in the new era of the living room
• Managing infinite choice: the new era of TV user interfaces

The Webvideotage award for the best music video available online originally went to Austrian Artist Herr Tischbein for a video that depicts the artist together with his dog Pascal, which seems to have many human qualities. Check out the video embedded below to see what I’m talking about.

The Webvideotage jury especially honored the fact that the video was available freely online when giving Herr Tischbein the award in February. However, German music fans have been unable to access the video since the beginning of April. From the Webvideotage blog:

“The video… is only blocked for German YouTube users. Users from other countries, including Austria, can still access it.”

This isn’t the first time music videos available elsewhere have been blocked in Germany. The local performance and publishing rights organization GEMA has been in a stand-off over royalty rates with Google for about a year now. The rights organization wants to get paid every time someone watches a video on YouTube, but the video site presses for a revenue-sharing deal instead. GEMA has since taken YouTube to court and blocked access to hundreds of music videos from major label acts.

Consumers have long voiced displeasure about these measures. Recently, two music fans decided to strike back at the music biz by blocking employees of GEMA and major labels from accessing hundreds of German blogs. Some artists have also criticized GEMA and their labels for not making their music accessible on YouTube, and steps like the one taken by Webvideotage could put even more pressure on rights holders to resolve their differences with the video site.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• How consumer media will change in 2013
• Controversy, courtrooms and the cloud in Q1
• Forecast: the future of the digital music industry

Geo-blocked content on YouTube...

The project is a reaction to the fact that rights holders have blocked hundreds of YouTube music videos in Germany, and it uses a kind of eye-for-an-eye approach to get its point across: Website owners add a few lines of JavaScript code to their site to actively block visitors with IP addresses owned by major labels.

Bust All Major Labels even copies the message YouTube shows its visitors when videos are blocked in a certain geolocation, albeit with a few differences. Employees of major labels are shown the middle finger, with a warning that reads: “The content of this site isn’t available for you. We’re not sorry at all about this.”

... and on German blogs. Can you spot the difference?

The two people behind the project are Christoph Maeschig and Mathias Keswani, who told German online magazine jetzt.de that they’re not doing this to fight the man. “We are not trying to say that record labels are bad,” said Keswani, adding, “We are just trying to say that we are annoyed.”

The heart of the conflict is that German rights holders haven’t been able to agree with YouTube on royalties for music videos. Germany’s performing rights organization GEMA is currently battling YouTube in court on this very issue, and more than 600 videos have been blocked on behalf of rights holders. A number of musicians have taken issue with this measure, complaining that they’re losing an important promotional opportunity, and many local Internet users have voiced their displeasure as well.

Maeschig and Keswani don’t expect that Bust All Major Labels will actually help to resolve the issue, but the duo told jetzt.de that they really just wanted to make a point. Said Keswani: “Record labels and YouTube are somehow working together in the U.S., generating millions in profits. Why can’t we do the same in Germany?”

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• A clouded view of Google Music
• Report: The Live-Stream Video Market
• Report: Monetizing Digital Content

It will be retroactively applied to all works since YouTube’s launch in France in 2007, and will expire in 2012, after which the two parties will have to renegotiate. Details of the agreements are not available, but SACEM CEO Bernard Miyet called it “a well-balanced result,” and YouTube’s director for European partnerships Christophe Muller went on the record saying that Google was “extremely pleased to have reached an agreement with SACEM.”

That’s not all press release hyperbole, as YouTube has been struggling to seal deals with some European rights holders. Things are particularly difficult in Germany, where music rights group GEMA is pursuing YouTube in court after negotiations broke down earlier this year. GEMA has been demanding that YouTube blocks hundreds of songs of its rights holders in absence of an agreement, and tried to get a preliminary injunction against the site in August. A local court rejected his request. This led to a full-blown lawsuit by GEMA, which is currently pending.

At the core of the dispute is the question of how and how much YouTube has to pay to GEMA. The group is asking to be compensated per play, but YouTube insists on a revenue-sharing deal instead, which is widely assumed to be the way the French deal is structured as well. A YouTube spokesperson told us back in May that per-play deals are out of the question:

“YouTube… cannot be expected to engage in a business where it loses money every time a music video is played — that is simply not sustainable.”

Update: YouTube spokesperson Chris Dale got in touch with me to dispute the notion that YouTube has been struggling to seal deals in Europe. “We actually have signed deals (with) the UK, the Italian and now the French collection societies,” he wrote, adding: “I’d say that’s some good momentum.”

Image courtesy of (CC-BY-SA) Flickr user MPD01605.

Related content on GigaOm Pro (subscription required):

• Live Event Coverage: Video Rights Roundtable
• Forget Syncing, Let’s Put Music in the Cloud!
• Why NewNet Companies Must Shoulder More Responsibility

Representatives of GEMA announced today that they’ve struck an alliance with a number of international music licensing groups, including the U.S. performing rights organizations ASCAP, SESAC and BMI, to put pressure on the Google-owned site. A YouTube spokesperson told us that it is “disappointed in GEMA’s decision.” Negotiations between the two sides have been going on for more than a year, and YouTube already briefly blocked access to music videos in April of 2009.

GEMA sent a list of close to 600 works today, demanding that the site either take down or block access to videos making use of those works. GEMA representatives said during a press conference today that they want to send a signal to YouTube, but not prevent widespread access to videos on YouTube.

The list of titles that YouTube now has to block was chosen more or less at random and that it contains both well-known and lesser-known songs, according to GEMA representatives. The group reached out to ASCAP, SESAC and other international licensing partners, who contributed to the list with titles from their repertoire.

GEMA used to have a preliminary licensing agreement with YouTube, which expired at the end of Q1 2009. GEMA asked at the time for significantly higher rates, and YouTube responded by blocking access to countless music videos from Germany. The site restored access to these clips when both parties began licensing negotiations again. YouTube said at the time that GEMA’s demands were 50 times higher than what it was paying to the U.K. music rights group PRS. GEMA representatives called these numbers today false.

The rights group also took issue with YouTube’s previous demands to sign non-disclosure agreements related to any licensing contracts, calling the inability to tell its members and the public about any licensing terms “a big problem” and announcing that it won’t sign any further non-disclosure agreements.

A YouTube spokesperson told us that it is disappointed in GEMA’S decision to end licensing talks, continuing:

“YouTube… cannot be expected to engage in a business where it loses money every time a music video is played — that is simply not sustainable.”

Image courtesy (CC-BY-SA) of Flickr user currybet.

Related content on GigaOm Pro: Live Event Coverage: Video Rights Roundtable (subscription required)