Facebook will now directly share a percentage of ad revenue with music rights holders for user-generated videos. Your move, tik tok…

If you’ve been paying attention to MBW this month, you’ll know there’s an increasingly vociferous debate going on about “emerging” social platforms, and the different models they use to push music rights holders.

Top music executives have begun calling on the likes of TikTok, Meta and others to pay the exclusives to publishers and record companies through lump-sum licensing advances (or so-called buy-out deals) – rather than sharing an agreed-upon percentage of revenue for every play/use of music made. income from it on their platforms.

Today (July 25), then, is an important day: Meta just announced that it will change the way artists and music rights holders pay Facebook — and that will You are now moving to the Revenue Sharing model for user-generated video content.

Whether the music industry united in happiness with size Of that share of the proceeds, of course, has yet to be seen.

(Lest we forget, in a potentially unrelated—but also potentially related—move, Kobalt Music Publishing pulled 700,000 songs from Instagram and Facebook in the US, after it failed to agree a new licensing deal with Meta.)

Here’s how the new system works: Meta has confirmed to MBW that video creators who choose to use licensed music in videos longer than 60 seconds on Facebook will receive 20% A share of any advertising revenue generated from its creation.

Residual 80% From this advertising revenue will be split between the appropriate music rights holders and Meta itself.

What is the nature of this division? We don’t know yet – Meta hasn’t confirmed this.

Whatever it is, however, it means, for the first time, that the music industry gets a direct share of every tiny bit of money generated by an ad on Facebook’s UGC video (uses licensed music, is more than a minute long).

Interestingly, it also means that Facebook users – including influencers who have a lot of followers on the platform – suddenly become financially motivated (via 20% share) to promote the licensed music they love in their posts.

Today, Meta said the move “opens up a new way to make money for both creators and music rights holders.”

She added, “With videos making up half of the time spent on Facebook, Music Earning Sharing helps creators access the most popular music, deepening relationships with their fans — and the music industry.

“This feature is made possible by our partnerships across the music industry, a first on this scale, benefiting creators, our partners, music rights holders and fans.”

“This feature is made possible by our partnerships across the music industry, a first on this scale, benefiting creators, our partners, music rights holders and fans.”

Meta continued: “Music Revenue Sharing will begin rolling out today to video creators globally. To start, eligible videos will be monetized from in-stream ads in the US, expanding to the rest of the world as music is available on Facebook in the coming months.”

“We will continue to work with our music partners to expand our licensed music library to include more licensed songs from your favorite artists and develop the experience.

“These efforts will help bring creators closer to the music industry, leading to more realistic relationships with fans.”

Among the footnotes to remember here:

  • i) This new payment system only affects user-generated content: it does not affect plays/ads official Music videos on Facebook. The licenses for such content are still, we assume, covered by prepayments “in a lump sum” to rights holders not restricted by consumption;
  • b) This is for Facebook only – the other leading Meta platform, Instagram, has not been affected yet.

Meta says the new launch is made possible by its Rights Manager tool, which it calls “the video, audio, and image matching tool we developed at Meta to help content owners protect their rights and manage their content at scale.”

According to its latest release music in the air Report, Goldman Sachs estimates that Facebook contributed 29% of all advertising revenue from Emerging Platforms paid to the recording industry in 2021.

who – which 29%MBW calculated (based on Goldman/IFPI numbers), equals just over 400 million dollars.

Remember: This is for one year only, and only covers money paid to the record industry (not the music publishing business).Music business around the world

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