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Facebook offering hundreds of millions to get music licences quicker

By | Published on Wednesday 6 September 2017

Facebook Watch

Licensing music rights for a streaming service is famously complex, and even more so if your streaming service is a user-upload platform where any old fucker can upload some shit video with an Avril Lavigne track playing in the background. But Facebook may have found a short-term fix to help it circumvent some of the immediate complexities.

It’s long been a core principle of music copyright – taught to every law student who ever majored in the business of intellectual property – that big piles of cash can make licensing headaches go away. For a time at least.

I’ve not done the maths, but I’m pretty sure a few million will last at least as long as your average pack of Nurofen. And, according to Bloomberg, Facebook is currently offering the record companies and music publishers hundreds of millions in advances. And that buys you quite a lot of paracetamol.

Sorting out music rights has risen up Facebook’s task list of late, of course, as it ploughs on with its ambitions to become a YouTube-rivalling video platform. Like its Google-owned competitor, Facebook is currently residing in one of those pesky safe harbours the music industry loves so much, which ensures that it can’t be sued when its users upload videos soundtracked by unlicensed music.

However, to keep its safe harbour protection, the social network has had to provide a takedown system to help music companies remove videos containing their tunes from the social network, if they so wish. Which it does, via Rights Manager. Which means users uploading music-containing videos to Facebook are much more likely to see their content blocked than with YouTube, where rights management set-up Content ID also gives rights owners the option to monetise rather than block videos containing their songs or recordings.

Facebook is busy turning its Rights Manager technology into a Content ID clone, adding in monetisation options. Though that requires sorting out how income from ads that play alongside videos on Facebook will be shared with the rights owners. And also persuading the record companies and music publishers, who have turned slagging off their YouTube licences into something of a sport, that they might like to enter into similar licensing arrangements with the social media giant.

Both Facebook and the music companies hope that deals can ultimately be done, and that Rights Manager can be further developed to equal and out-perform Content ID. But that will take time – up to two years some reckon – and Facebook wants to solve the music-rights-owners-blocking-videos problem sooner than that. Especially now that it’s launched its Watch feature, which encourages people to browse videos on Facebook in more of a YouTube-stylee.

Offering the music industry mega-bucks advances will likely speed things up, in that it could secure Facebook short-term suck-it-and-see licences from the record companies, music publishers and collecting societies, that will allow the music to play across the social network while it works out the technicalities, legalities and commercial realities of Rights Manager long term. Indeed, YouTube got a few years of music industry love by writing some big upfront cheques, until it became the biggest streaming service in the world and the music rights owners decided they wanted quite a bit more.

Of course, while a big pile of cash might make some of the music licensing complexities go away for Facebook, such payments arguably add to the complexities within the music community, especially for artists and songwriters, who have to work out how said money is being shared with them by their labels, distributors, publishers and collecting societies.

Plus Facebook also has to decide how to share whatever money it allocates for the big musical bung between all the competing rights owners, remembering that, whenever you think you’ve written the last music rights cheque, another stakeholder is prone to pop up and point out that they need paying too. Fun times. I might make a shitty video about it all and post it to Facebook. But which Avril Lavigne track should I use to soundtrack it?



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