Facebook Negotiates with Music Industry Over Video Content

Facebook is doubling down on inking agreements with music industry publishers, labels and trade associations, with the goal of accessing user-generated videos that include songs and, ultimately, the labels’ own professionally produced videos. Facebook’s main rival is Google’s YouTube. From the music industry point of view, a deal with Facebook could bring substantial revenues from its 2 billion users and growing advertising division, as well as create a bargaining chip in negotiations with YouTube.

Bloomberg notes that, “an agreement with Facebook could also serve as a blueprint for deals with other social-media companies, like Snapchat.”

“We’re hopeful that they are moving towards licensing music for the entire site,” said National Music Publishers Association president David Israelite. At the same time, a deal with Facebook could provide users with another way to get music for free, potentially upending the industry’s recent “surge in sales from paid services like Spotify.”

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Current negotiations include a hard look at how to prevent copyright violations with regard to user-generated videos. YouTube’s soft approach to copyright enforcement has earned the ire of the music industry, “which spent the better part of the last year fighting YouTube in the press” and finagling for stricter laws.

Facebook — which, to the approval of the music industry, hired former record executive Tamara Hrivnak, who also worked at YouTube — has promised both to “police piracy and share ad sales.” Although the company is working on a system similar to YouTube’s Content ID to nab copyright infringements, Israelite notes that Facebook, like YouTube, is shielded from responsibility by the Digital Millennium Copyright Act.

TechCrunch reports that Facebook is pushing for a broad music deal, since that would “allow users to either edit popular music into their creations or record clips with popular music in the background… [or] Facebook could even build a way for people to easily select songs to add as the soundtrack to their videos” — all without infringing on copyrights.

If Facebook fails to strike deals, it adds, users will be disappointed or even angry if the soundtrack to a compilation of family “moments” gets the video removed from the site. “That can discourage users from creating videos for Facebook in the future, depriving the social network of its most vivid and monetizable content.”

Striking an overall deal will serve both Facebook and the music industry, but “the question is whether Facebook can draw a line between incidental uses of music, where a song is more of an accompaniment to a video, and deliberate piracy, where the video is really just a place-holder so users can search and listen to a song for free.”

The latter, says TechCrunch, is “common on YouTube.” With a deal for legitimate use of music for user-generated videos, Facebook’s next move could be to offer a feature that suggests specific songs, a gateway to “gain leverage over labels and open sponsorship opportunities.”