Musician Jack White. Getty Images/David Wolff YouTube is getting ready to release its ad-free music streaming service, but a report from The Financial Times says the company will block videos from any independent artists who don’t sign up for the new paid service.

According to the report, YouTube will block those indie artists from using all of YouTube — including both the free and paid sections of it — “to ensure that all content on the platform is governed by its new contractual terms,” according to Robert Kyncl, YouTube’s head of content and business operations.



According to Kyncl, record labels representing 95% of the music industry have already signed up to YouTube's new terms, while the remaining 5% will be blocked from the platform. Those same artists are asking European regulators to intervene.

“While we wish that we had 100% success rate, we understand that is not likely an achievable goal and therefore it is our responsibility to our users and the industry to launch the enhanced music experience,” Kyncl told the Financial Times.

A source close to YouTube told Business Insider the deal will not affect regular users that post their own songs and videos on their own channels, but it will affect musicians signed to multiple record labels in multiple countries. Here's how it works:

If Artist X from the UK is signed to their friend's indie label in their home country, but also signed to a major record label in the U.S., I'll be able to watch the video in the U.S. but not the UK. It goes back to which label is bringing this content to YouTube, and from which country.

The source added "negotiations are still open" with the remaining 5% of labels that have yet to sign on.

"We want to get to 100% but we don't think it's fair to the other 95% of partners to hold back [launching the service]," the person said.

The Guardian says this move to block independent artists that don't agree to the terms of YouTube's paid service would also affect several big name music brands, including The Arctic Monkeys, Jack White and Adele. According to The Financial Times report, Kyncl said YouTube was offering all rights holders "a good deal," but would offer no further details about the contracts.

“We’re paying them fairly and consistently with the industry,” Kyncl said.

A YouTube spokesperson again confirmed the Financial Times report in a statement to Business Insider:

Our goal is to continue making YouTube an amazing music experience, both as a global platform for fans and artists to connect, and as a revenue source for the music industry. We’re adding subscription-based features for music on YouTube with this in mind — to bring our music partners new revenue streams in addition to the hundreds of millions of dollars YouTube already generates for them each year. We are excited that hundreds of major and independent labels are already partnering with us.