After Amazon announced Prime Music last week, YouTube is following suit by confirming its own paid music streaming service, which will debut sometime over the summer.

The ad-free service will allegedly be called YouTube Music Pass and will allow users to download full albums for offline listening. The pricing details for the service haven't been divulged, but it should be interesting to see how Google would integrate this service with Play Music All Access.

At the behest, YouTube has managed to negotiate licensing deals with three major record labels — Sony, Warner and Universal. However, it looks like the video juggernaut was not able to reach an agreement with indie labels, with most labels coming out and stating that the royalty terms YouTube proposed undercut what other streaming services like Spotify, Rdio and Rhapsody offer.

Speaking to the Financial Times, Vice President and Global Head of Business at YouTube Robert Kyncl stated that video content from indie labels will be blocked "in a matter of days" should the labels not agree to YouTube's terms. He said that signing all labels is "not likely an achievable goal," and that the dispute with the indie labels will not affect the launch of the service.

A source familiar with the matter revealed to Reuters that "blocking certain music labels' videos from appearing on YouTube's free website might be necessary in order to provide a consistent user experience" for the paid service. It doesn't make much sense to have paid subscribers if the same video was already available for free.

Even though several publishers may not be able to sign licensing deals with the service, YouTube said in a statement that the new streaming model will "bring our music partners new revenue streams in addition to the hundreds of millions of dollars YouTube already generates for them each year."

Should a deal not materialise between indie labels and YouTube, videos form several top-tier musicians like Adele, Arctic Monkeys, The XX, Radiohead and others will likely be blocked on the website.

What are your thoughts on YouTube's paid streaming service? Would you considering shifting from Spotify or another music streaming service for YouTube's offering? Share your thoughts in the comments below.

Source: Financial Times (subscription required)

More coverage: Reuters, Billboard, Forbes


Reader comments

YouTube confirms paid music service, intends to block holdout labels' videos 'within days'


How is this google forcing indie creators in to accept the terms. They are just blocking the ones who didn't accept. Take any software, OS, service without accepting terms you cannot use them at all. Try denying any terms and condition anywhere

They're taking away access to a service that has been available for years and forcing them to accept terms. This isn't a difficult concept to grasp.

This is a step in the wrong direction for a company that has used "Don't be evil" as a slogan in the past.

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To be fair "Don't be evil" was never and official mission statement for the company. It was more of an internal thing that kind of leaked out.

I don't really think that should be relevant. Why should a company need it spelled out that they shouldn't be evil? I know good and evil are somewhat nebulous concepts, but not being evil should be a given for any company that is allowed to operate. The least we should do is call out any company on their unethical behavior, even if that behaviour happens to be legal.

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It looks to be like Google is using its dominance of YouTube to get favourable terms for its new streaming service. That there is possibly an antitrust lawsuit in the making.

I do feel like I'm missing some of the story here, though. If Google are offering the same revenue for the paid streaming service as these labels would get for ads on the music videos then I don't see why the labels would have a problem, but I suspect that isn't the case. Still, from what I know I don't think they should try to force the hands of the labels like this, and even if it isn't illegal, it does seem like they are "being evil".

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If the terms per play are equal, having them behind a paywall or subscription will eliminate a large majority of people that were ok with the ads, but don't/can't pay for online content that is otherwise free.

They got less per play, but a lot more plays with the free ad supported model, then they will get with the pay subscription. This is assuming of course, that that is they reason they are holding out on signing with Google for their service.

Why would you have a website that allows people to post videos for free, then tell ONLY musicians they can't post their videos? Youtube has definitely gone down the drain since being purchased by google.

If this happens another YT like video service will probably be developed and dedicated to music and bands and will gain fast popularity. Wouldn't be surprised if MS or Yahoo created a free service just for spite.

This kind of sucks, because I already pay for all access and am not going to pay to YouTube for music. This really sucks because I like all the YouTube Led Zeppelin bootlegs there are from old concerts from the 70's. Also YouTube is where I go to discover new bands as well as everyone else does.

Is YouTube losing money in ad revenue?

You'd think a Billion views a week would keep them flush in generating advertising

Anyone know if Nuclear Blast, Metal Blade, Century, and other primarily metal-focused records are in? I know some are part of universal or Sony or whatever, but if they aren't on I'm quitting YouTube for good. YouTube is how I get a lot of music on mobile because I can't afford to pay for things, and not having the stuff I love is a dealbreaker.

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YouTube is where I DISCOVERED a lot of bands on thoes VERY labels you just listed. All the Euro metal bands aren't promoted here in the US, through YouTube I found a bunch of bands whom I've supported through record sales and tour tickets. I think for record labels this is a huge step backwards. More visits to Pirate Bay ahead I see.... Poor form Google

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Same here. Video games got me into metal, but most bands I know I discovered on YouTube. Back to YouTube-mp3 and pb I go... -sigh-

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Alas not Z2, cameras on the wrong side, status bar icons are different and the rocker on the left shouldn't be there.

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Google is just like any other public held corporation. They will do what makes them the most money and usually that ends up being bad for customers. We are "The United Corporations of America".

True enough, but if customers speak with their wallets and DON'T buy into their service, then they'll be forced to change course if they don't want to support something not making them much revenue. I, for one, won't be paying for this service. Why would I need to if I am already paying for G Music All Access? And THAT is what makes the least sense to me. Why would Google support TWO SEPARATE music streaming services?

Bummer... it feels like a step backwards (more like a good 1,000 steps, actually) for YouTube :( Part of what made it great is now threatened. Nice one, Google... nice one... :(

What the f*** Google? Way to ruin YouTube! And how is this different from what they already offer, Google Play Music All Access? Leave YouTube the way it is!

It's funny how everyone forget Google is a for profit company with stock holders to answer to. Something has to pay for the development of those "free" services and apps we all enjoy and talk about on this site. If artists don't like the terms they can go to vimeo or MySpace music. If they have a following people don't care where it's hosted.

Google isn't by far the largest online ad firm or anything..... Just sayin....

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YouTube must be hurting in generating ad revenue, you'd think it would generate a lot from a billion views every week

When you're so dominant at something the very name of your business is a noun, verb and adjective all in one then blocking certain companies from using your service is anti-competitive at best and possibly toeing what is spelled out in the Sherman anti-trust Act.

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It is not anti-competitive and nowhere near toeing what is spelled out in the Sherman Anti-Trust Act.

If you're gonna talk, at least know what you're talking about. Don't throw out terms and words you've heard others say and think they apply. You come off as foolish when you do, you're as bad as the people saying Amazon is a monopoly. By which I mean you're sounding just as silly.

It is anti-competitive. You sound just like the lawyers for AT&T, Microsoft and Intel when they were found to be flexing their considerable muscle to force companies into doing what they want. It's actually called a monosopy instead of a monopoly.

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It actually isn't. Again, you clearly don't know what you're talking about. How are they being anti-competitive? Let's here you state that. Explain thoroughly how it is anti-competitive? You can't just say "it's anti-competitive". You have to explain how and why.

Creating a service that people subscribe to and requiring that artists agree to new terms and conditions to continue making use of YouTube in accordance with the new ToS agreement is NOT anti-competitive. Especially when there are other options for those who refuse to agree to the new terms of service and licensing agreements to use in lieu of YouTube.

Ah, so you're comparing entirely different situations to this one? So you're not just wrong, you're wrong and unable to see the difference between varying situations? Gotcha!

Monopsony is "a market form in which only one buyer interfaces with many sellers." Explain how that applies here. I'll wait for your moronic response, seeing as it doesn't. There is more than one buyer and in point of fact, Google isn't even a buyer, they merely provide a service and AGAIN there are others who do the same who artists and labels who do not agree with the new licensing conditions and terms of service agreements can turn to in lieu of YouTube.

Look, it's okay. You don't get the situation. That's not your fault. Some people get things, some don't. And that's okay, but don't talk about things you clearly don't get, because you just spread misinformation or flat out wrong information to others who might be naive enough to think you know what you're talking about.

Microsoft never had 100% of the desktop market but was determined to have a monopoly nonetheless.

Perhaps you should spend less time insulting someone for deficiencies you obviously suffer from yourself.

Google isn't be "anti-competitive" here. However it is using its overwhelming market position to exact terms that a less-dominant service could never attempt. It certainly is not commendable and akin to what Amazon is doing to squeeze its suppliers.

There is STILL a huge difference between what Microsoft did in the desktop market and what is going on right now with the music situation and YouTube/Google.

A huge fucking difference.

Oh look, hypocrisy thy name is ScottJ. You shouldn't wag a finger at others for something you yourself just engaged in.

And you, much like the other 'tard, clearly have no idea what's going on or why.

So unless you can explain exactly what is going on and solely how it relates to Google and how it is anti-competitive, which is what bergeronjc has seen fit to state on this site multiple times now without actually supporting in any way with facts/evidence or anything, then you can kindly take your Microsoft comparison and stuff it.

I did some research on that and it doesnt quite fit the bill, the act states:
"... [a person] who merely by superior skill and the whole business because nobody could do it as well as he could was not a monopolist..(but was if) it involved something like the use of means which made it impossible for other persons to engage in fair competition."

So with that google is more the former than the latter. It does suck they will be changing youtube but it makes sense from the business side of things for them. Now we just have to wait for another youtube like service to come around.

Lawyers for Microsoft argued the same thing when defending the position of Internet Explorer. They failed to convince anyone.

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They don't. But bergeronjc actually has no argument to make and he's shooting for the easy one. "It's similar to this! And you sound like a lawyer for Microsoft!" Translation: Shut up! You're picking on me! What with your logic and facts and research and all that!

I've asked him multiple times now to explain how it is anti-competitive and how it plays into the Sherman Anti-Trust Act. The fact that he was replying to us within literally seconds of our comments to him but has posted nothing since then speaks volumes. He was backed into a corner and decided to bail rather than make an actual point complete with facts and evidence to support his claims of anti-competitive behavior.

Take a bite me pill. Pointing out how the Microsoft comparison doesn't relate is not me stressing. It's stating a fact.

If you want to kiss bergeronjc go ahead, but no need to defend him as you seem to be doing obsessively.

That's what the ads are for. How much you want to bet ads will still be shown on these paid videos.

That is worse than Amazon flexing their muscle with Hachette.

I really really hope the DOJ gets involved and either blocks this from happening or brings an anti-trust suit against Google.

These tech companies are getting ridiculous with how they think they can act.

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See, this is you discussing things you clearly don't understand. Not even remotely.

Amazon isn't flexing their muscle with Hachette, nor with Warner Bros. Hachette and Warner Bros. came to Amazon with deals basically saying "you're going to carry our products at the prices we want", Amazon of course did not agree with this as it basically prevented them from setting their own prices. So what happened? Amazon started negotiating with those two and removed their products in the mean time. Now, here's where someone like you might get lost and start saying things that don't apply to the situation. Amazon is under no legal obligation to carry anyone's products, much less have to accept that those people can dictate to Amazon what prices they will sell the products for in their (Amazon's) store.

Amazon is doing nothing wrong and nothing that no other company wouldn't themselves do when someone came to them and told them how they were going to run their store.

I really hope the DOJ doesn't, because there's clearly no reason to (short of misunderstanding the situation and not knowing how things work). When they don't, can we expect you to admit to being wrong about all of this? Or even better, assuming they do and that they say "Google is doing nothing wrong, much less illegal", can we then get you to say you were wrong?

These tech companies are doing no such thing, they're continuing on as they always have. Sadly people have seemingly gotten stupider and don't understand how businesses work and they love posting knee jerk reaction type comments online without thinking things through logically and rationally first.

Or it's not. Considering that's what has been reported on numerous other sites.

Remove your head from wherever it is and see that it is normal business practice as they occur every single day. The only difference is the name and size of the players involved.

God, you do like hounding me though. Like a dog with a bone. Let me guess, Amazon sent you an order a day late one time and you're still upset about it?

It should work like this, if you have Google Play Music All Access, you should be able to listen to music ad freely on YouTube. We don't need all of this extraness that's in the article.

nexus_logic - Working on his HTC One Max in the Nexus Lab

LOL. Lets be real. I don't go to Youtube for their music videos. I go there for a small number of gaming and tech channels. if they stay on youtube, i'll continue to watch. If they leave, i fully intend to never use the site again. I go where the content I want goes.

WOW stupid move. They already get revenue for adds isn't that enough. I could understand if you wanted to get an add free experience (like the old days).

If they don't watch out a new service will crop up and everyone will leave. There was a world before YouTube and there can be again. Hello Microsoft...are you there...Sony...kid living in his/her mom's basement

No, that isn't enough.

The users complain because there are too many ads in the videos. Listening to the customers (and making more money for themselves), Google offers a way for users to view videos without ads. How much more are those subscribers going to complain when some videos on their (now) paid service are displaying ads? Do you think the users are going to direct those complaints to the artist/label because they won't let Google display their content without ads? Of course not... they are still going to blame Google.

Google's only recourse is to end the previous contract and no longer display the videos.

There are a lot of people here who are readying the torches and pitchforks and saying things like "monopoly" and "Sherman Anti-Trust Act" and I'm going to post this here for all those people, because they clearly do not know a great many things.

First and foremost, being the biggest and most popular DOES NOT a monopoly make. There are competing services, all of whom can be joined or used by ANYONE. That pretty much shoots down the "monopoly" responses some of you quickly turned to.

Secondly, someone over on Ars decided to use that thing between their ears (brain) and think things through rationally like an adult rather than quickly jump to the comments and hate on Google with a typical knee jerk reaction. Some of you could learn a thing or two from that guy.)

Here is the comment that person left, which when read and thought about makes complete and total sense.

"1. Youtube wants to offer users a subscription service with no ads.

2. Youtube needs to update its licensing/terms with artists.

-If a video plays for a subscriber they see no ads, artist gets money from subscription pool

-If a video plays for a non-subscriber they see ads, artist gets money from ads pool

3. Artists need to explicitly agree to these terms because it changes how and how much they'll get paid.

4. It doesn't seem fair for a user to pay a subscription, expect to see no ads, and then see ads for some video's because that artist/distributor did not agree to new terms. This is why Google wants all or nothing."

So there you have it, things boiled down as simply as possible. Next person to say monopoly or "I hope the DOJ investigates them", I hope you drop your phone into a glass of water or six feet onto a concrete floor and the screen shatters. It'll be karma, paying you back for being a bit of an idiot.

I also understood that comment clearly.. AND IT STILL SUCKS.

"This is why Google wants all or nothing." theyre flexin their muscles fool. Im just saying its a way to push some of your viewers away, and certainly some artist will start uploading to another service, so now the viewer needs to visit yet another site. Just seems unnecessary to even touch youtube on this front. Don't they have google music access pass?

So, wait, if I make a song and then film a music video, I'd have to license my song with YouTube or they'd take it down?! That's such BS!

I'm an artist & I'm wondering the same thing. Is this how it's really gonna be? I'm lost..

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I'm going to assume you genuinely aren't getting what's taking place, so I'm going to do my best to explain it.

Google via YouTube wants to turn YouTube into a paid subscription service. I think it's safe to say you're with me so far. In order to do that, they need to negotiate licensing terms with various labels. Still with me I hope. Now here's the kicker, they want to provide the same consistent experience to all end users, so to do that they pretty much have to negotiate with everyone and their mother licensing terms. This might be where I lose you. That means they have to negotiate with everyone on a one on one basis and say "you will receive X dollars from Consumer Y every time they watch your video or listen to your music, that's from those who subscribe" and/or "you will receive X dollars from Ad Revenue Pool Z every time a non-subscriber watches your video or listens to your songs". That's pretty much things in a nutshell.

Now, here's where your question comes into play. Again, consistent user experience. That means they need you to sit down as an artists or or an artists via your label and read the licensing terms and terms of service agreement and decide if you want to sign or not. They aren't forcing you to sign and they aren't saying you can't take your music or videos elsewhere. They're saying though "step to the table and if you like what you see then sign and if for some reason you don't wish to sign then in the interest of providing that across the board consistent user experience to the end users we're going to take any and all songs you currently have up down and prevent you from putting them up after the fact until you either sign or don't sign, because things need to be the same for everyone at the end of the day".

I think that covers it. You need to step to the table and sign new licensing terms for them to determine what you make in royalties and from what revenue pool it's taken from without screwing over paying subscription customers. If that's not cool with you then "sorry we couldn't do business together, I wish you the best of luck in whatever you do".

It's quite simple really and it really does seem fair when you look at it that way. At least for the end users. Now, as an indie artists you might see it otherwise, but they aren't saying you can't play. They're just saying if you're going to use my service then you need to agree to my rules. Which is their prerogative, because if they make exceptions for you then they'd have to do so for everyone else sooner or later and that defeats the purpose of even bothering with licensing agreements for the big labels now.

Agree. But I think there is another choice that you are missing. I basically covered it below...

In summary, artists/labels could also choose NOT to get paid by Google. Essentially giving Google free license to display their works. They could still use the service, and Google would be free to display them with or without ads.

The Artist/Label wouldn't get revenue from Google, but would still have the benefit of the free exposure from the largest online video service.

Then the artist can host it for free on their own server and pay for their own bandwidth. Google didn't buy YouTube so they could be the world's hard drive for free. This stuff costs money.

Very true... but then you also lose the exposure that the internet's largest online video service provides.

Okay, that's another possibility but you're overlooking the obvious. Everyone wants to get paid. For every artist that says "Google, I don't want your money, so you keep it, but I do want to make use of your service" there's going to be one who says "I want your money, I don't want to sign your contract and I want to use your service". You're going to end up having to deal with a lot of different people demanding a lot of different things.

Which then makes things difficult for more everyone involved, particularly Google.

No, their approach of "all or nothing" is the only sensible approach to take. You're either with them and you can collect your due and use your service or you aren't and "best of luck to you, plenty of other sites can host your content".

It's really the simplest approach and one that is truly fair to all.

No, the simplest way would be what they're doing now and not trying to double dip. Every single one of those music videos ALREADY has ad money being made from it. Now they want people to sign up and pay in addition to likely still seeing those ads. Just you wait, YT may forgo ads for a short time, but then they'll be slowly added back in. And for what benefit? None to the customer that I can see. They're introducing a subscription model for something that was PREVIOUSLY FREE. That's terrible.

I'm not saying it isn't terrible. But that's what's coming. So they'll either do it and remove it if it truly is terrible or they'll do something else.

They're not trying to double dip though. Double dipping would be getting money from end users and the artists/labels.

What they seem to be doing here is just getting money from the end users, either directly from them or via ads for those who choose not to subscribe. That isn't double dipping though at least not as I understand it.

Also, you're assuming people will pay and then still see ads. I've seen nothing written anywhere else that states that will be the case. You pay, you get no ads and tunes. If you've got a source or a link that you can share with the class showing things as you paint them then by all means share it. Other wise it's just more of the same speculation without substance to back it up.

"It's quite simple really..."

Then why did you have to post a manifesto to try and explain it?

To explain it for the people who refuse to think for themselves or who really need it broken down for them.

If it takes a manifesto to lay out something in as easy to understand a manner as possible, so be it. But if you consider that a manifesto I'd really like to known what you consider something like Lord of the Rings to be?

Also, is it your job to reply to each and every single one of my comments in a snarky and dick-like manner?

That depends... Do you intend to make money from the video? Do you intend for Google to pay you that money? If you do, then you have to license it to them. If you don't, then Google is free to distribute it with or without ads.

So what about those that already pay for Google all access. I think this is not fair for the indie labels. They don't have the same money like those big record labels.
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This sounds stupid. YouTube doesn't need a streaming service. They already have Google Play All Access. What's the point of having another service? They really wanna charge ppl to be able to watch certain videos? I really don't get it..

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I really do wonder how this will work with play music all access. Will it be a separate service or will it be included? If it is included they better not jack up the price because I could careless about YouTube all access or whatever they will call it.

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Do no evil...oh wait. Hopefully some big name players don't play along and even more important hopefully no one pays for this service. Maybe it will go away during the next spring cleaning just like Google + hopefully will at some point. If we're really lucky a new website will start gaining popularity at some point. If not to overtake Youtube completely at least to give it some competition which would prevent bullshit like this.

I'm waiting for the announcement that Google is moving it's headquarters to Ireland. They could save a few $billion that way.

The only way this will end is if the service fails from lack if revenue. Heck, that could be your use protest! But seriously, why not just use adblock? Unless that doesn't destroy video ads,....

Posted by a tuba playing,nexus 5 and 7 carrying future hacker.

Whoa! Can we say Google has a strong arm tactic?! And I'm honestly over all of these new music paid prescription services. Everyone is getting into the game, but no one has all of the music I listen to. I'm still not a fan of All Access from Google Play. Def wouldn't give the YouTube version a try.

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Well, I'm not a fan of this. And I dislike many of the recent changes to YouTube. For example, the comment section, Google+ integration, and several of my favorite users had content removed and legal action was threatened. The issues were resolved months later, but most continue to upload videos elsewhere.

With that said, I think I've reached my limit with monthly music and movie subscriptions. I'll continue to use Netflix and XM Radio, though.

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Soo what we really need is a Google All-Access Pass.. Spend about $200/year and get every paid for service by Google..

This is what were coming to..

If you don't wanna pay: get screwed with spam ads...

On that note: what's Vevo? Isn't that where YouTube's music videos supposed to go!?

Anyway. A newer company will come around and monetize on Googles new subscription requirement.

(Vimeo looks better every day)

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This whole concept seems silly and a waste of resources. Google already has a great music subscription service. Sure, YouTube can offer music videos as well, but hardly seems like a feature that should be enough to create a whole new paid service. I also can't imagine that a subscription service will yield them nearly as much in revenue as ads in the videos do.

I kinda hope Vimeo becomes the new home of music vids.

Well, there goes most of my usage of Youtube. Spotify it is for hearing a song that is stuck in my head.

No. it means that you don't get an ad-free experience on YouTube without one. And you will possibly miss out on any indie bands/acts/labels that don't agree to the terms of use.

Google and You Tube slowly going down the sewer tube.

I see bangishotyou must work for them. Sure has carried all the water for them on this comment site.

Another site will emerge, and that will be the end of you tube all together.

Watch out. The guy will accuse you of "not knowing what you are talking about" for simply disagreeing.

I work for an engineering firm actually. But seeing as how I have critical thinking skills people like you seem to lack, it only stands to reason I'd be here leaving comments to people like you who clearly aren't seeing the full picture.

Thanks for the mention though! You mad, bro?

EDIT: Oh, it's your first post ever too! Me thinks the real shill has been found. ScottJ is that you?

wow, this is bad enough where i will consider leaving google music. good timing on the 'best music streaming' list!

I don't get why YouTube would block the free music videos when they can be serving ads even if the the label didn't join the paid service. All the videos that are in the paid service will still be viewable for free with ads. This seems like it would only hurt YouTube's revenue stream. I guess it would be a bit annoying to have the paid service and still see an ad on some videos but those videos could be marked in a way to tell the customer they don't qualify. They must think there will be a large number of subscribers to this service. If there is, I don't see myself being one of them.

This really ruins YouTube. Because right now it's the go to place when someone wants to look up a song or video. Removing a bunch of content, which by it's indie nature is probably more obscure, effectively removes it from the internet. At least until something comes in to fill the void. But how much will never reappear?

Sounds like extortion to me.

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