YouTube Nears $9B in Ad Revenue, Labels Fight Canadian Levy, and Apple and Meta Face Fines

How The Music Business Works - Issue #9

May 1, 2025

Welcome back to How the Music Business Works, where we break down what’s happening behind the headlines.

This week, the music and tech worlds are colliding in a big way. From Spotify’s record-setting quarter to the EU slapping Apple and Meta with major fines, the power struggles are heating up. Major labels are stepping into a Canadian legal battle over streaming levies, and the Isaac Hayes estate just scored a partial win in its copyright lawsuit against Donald Trump. 

Now, let’s get into what’s driving the conversation across the industry.

YouTube Ad Revenue Approaches $9 Billion in Q1, Up More Than 10% Year-Over-Year​

In the first quarter of 2025, YouTube earned $8.93 billion in ad revenue, marking a 10.3% increase from the previous year and just slightly below analyst projections of $8.97 billion. Parent company Alphabet reported over 270 million paid subscriptions across all its services, including Google One, and surpassed Wall Street expectations for Q1. CEO Sundar Pichai highlighted continued momentum driven by AI-powered search features and strong performance across YouTube and Cloud. Analysts believe YouTube, which brought in an estimated $54.2 billion in 2024, may soon overtake Disney as the world’s largest media company.

Major Labels Want To Formally Intervene In Legal Case To Oppose Canadian Streaming Levy​

Major record labels in Canada are seeking to formally intervene in a legal case opposing a proposed 5% revenue levy on streaming services, introduced by the Canadian Radio-television and Telecommunications Commission (CRTC) under the Online Streaming Act. Represented by their trade body, Music Canada, the majors argue that the levy overlooks substantial investments made by streaming platforms to support Canadian and Indigenous artists. They contend that the levy could deter these investments, potentially harming the very artists the policy aims to support.

Apple And Meta Attack ‘Unfair’ €700m EU Fines

The European Union has fined Apple €500 million and Meta €200 million under the new Digital Markets Act (DMA), marking the first penalties issued under this law aimed at curbing big tech’s dominance. Apple was penalized for restricting access to alternative app marketplaces, while Meta was fined over its “consent or pay” data collection model, which the EU says didn’t allow genuine user choice. Both companies have 60 days to comply. The decision has sparked backlash from the firms and U.S. officials, amid broader tensions over regulation and trade, with Meta calling the ruling a “multi-billion-dollar tariff” on American companies.

Spotify Posts Record-High Operating Profit For Q1, As Subscriber Base Grows By 5M To 268M Paid Users​

In Q1 2025, Spotify achieved a record-high operating profit of €509 million ($535.6 million), driven by a 12% year-over-year increase in premium subscribers, totaling 268 million. Total revenue rose 15% to €4.19 billion, with premium revenue up 16% and ad-supported revenue increasing by 5%. Monthly active users grew 10% to 678 million, led by gains in Latin America and other regions outside North America and Europe. Despite these gains, Spotify’s operating income fell short of its €548 million guidance, partly due to €76 million in unexpected social charges. Looking ahead, Spotify forecasts Q2 revenue of €4.3 billion, 273 million premium subscribers, and 689 million monthly active users.

The Isaac Hayes Estate’s Copyright Lawsuit Against Trump Can Proceed, But Judge Axes False Endorsement Claims​

A judge has ruled that the Isaac Hayes estate’s copyright lawsuit against Donald Trump over the use of “Hold On, I’m Comin’” at campaign rallies can move forward. However, claims of false endorsement and violation of publicity rights were dismissed. The judge found that simply playing the song does not imply Hayes endorsed Trump, and no misuse of Hayes’ name or likeness occurred. Trump’s campaign was originally covered under a BMI blanket license, but the estate and co-writer withdrew the song from that license in 2024. The court accepted the estate’s ownership documentation, allowing only the copyright claim to proceed.