Facebook and the Music Business

In this digital age, the race is on to see who gets the lion’s share of the pie. With frequent shifts in the music business, it is clear that who controls the content – in this case, #digitalmusic streams – is KING! A few years ago the debate around the decline of music downloads to music streaming, weighed heavily on how users/fans engaged with music. The industry took a hard blow over the years, from the rapid decline in sales revenue from physical copies (CDs). Fans were getting more selective; instead of buying an entire album, they could easily go online and play their favourites or buy as desired from sources like iTunes. For as long as I can remember, YouTube has led the charge with the streaming of online music videos; there we saw the birth of a new wave of artists: Cover artists, like Justin Bieber & The Weeknd! Youtube has been monopolizing the virtual web of music videos to this day and is the home for many artists to be ‘discovered’.
“Back in 2009, they partnered with Universal Music Group and launched Vevo, a music and video entertainment hub that featured UMG’s premium video content. This service blended UMG’s broad catalog of artists and content production capabilities with YouTube’s video technology and user community. This content was exclusively available through VEVO.com and a new VEVO channel on YouTube through a special VEVO branded embedded player.”
For all intents and purposes, this partnership has worked, increasing the user experience with access to a wider catalog of videos, which ultimately has increased traffic to the site. Facebook has been clamping down on users who post cover videos on its platform due to complaints from the likes of labels, such as Universal Music Publishing Group (UMG), under the guise of copyright infringement, in particular the DMCA – Digital Millennium Copyright Act

DMCA is a United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization (WIPO). It criminalizes production and dissemination of technology, devices, or services intended to circumvent measures (commonly known as digital rights management or DRM) that control access to copyrighted works. It also criminalizes the act of circumventing an access control, whether or not there is actual infringement of copyright itself.

With Facebook’s recent announcement on the hiring of former #YouTube Music Executive, Tamara Hrivnak, to lead Global Music Strategy and Business Development, we see it has gotten personal to rival its competitor and possibly loosen its grip on the market. According to Digital Music News: There’s no arguing that Facebook is on top of the social media empire. As of the third quarter of 2016, Facebook had roughly 1.79 billion users.
However, the social media giant has yet to tackle a serious problem: they haven’t secured any music licenses. “While artists complain about poor YouTube payouts, they may not receive anything at all from Facebook.” In a previous article in Digital Music News, writer Ari Herstand posed the question (in discussing poor payouts to #songwriters): “Why haven’t they (FB) come up with their own version of Content ID like YouTube has? And create a video monetization possibility” Yet in another article he lambasted #DavidBenjamin of UMG on the issue of #Facebook clampdown… stating that he (David Benjamin) is not standing up for #songwriters: “What most people don’t realize is that when major #publishing companies and major #labels strike deals with new platforms like YouTube, Spotify and SoundCloud, they get these platforms to pay them huge ‘advances,’ guarantees and sometimes even equity in the company that never finds its way down to songwriters or artists they supposedly represent. UMG is trying to shake down Facebook to pay UMG.” It seems like Mark Zuckerberg may be in agreement with Ari Herstand. In a recent publication by Music Business Worldwide, Mark Zuckerberg peeked the ears of #creators in the industry:
The respected licensing expert brings a weight of expertise from Warner Music Group and Google to the social media giant, which to date has hardly been a paragon of virtue when it comes to paying for music copyright. Yesterday, in an earnings call with investors, Mark Zuckerberg gave the music business yet more reason for optimism.The Facebook founder once again confirmed his company’s increasing focus on video – while making specific reference to ‘premium content’.
Much of this centered on the launch of a video ‘tab’, which will be dedicated to serving video to users in an environment which sounds very much like YouTube.

“CREATORS NEED TO GET PAID A GOOD AMOUNT IN ORDER TO SUPPORT THE CREATION OF PREMIUM CONTENT and we need to be able to support that with a business model, which we’re working on through ads to fund that. MARK ZUCKERBERG

Although Zuckerberg didn’t specifically mention #music, he hinted that Facebook could soon be ready to start sharing its advertising revenues with rights-holders of all kind. Facebook’s CFO, David Wehner also stated: “Our goal really is to kick-start an ecosystem of partner content in the video tab… and our model is really oriented towards revenue share with creators. We are funding some feed content to get the ecosystem going, but the focus is on rev share.” So will creators embrace this dream and will we actually see a more inclusive approach to content sharing and would this lead to greater payouts for the content creators and songwriters in the business? What we do know is that there is no backing down with Facebook… YouTube and other contenders like Apple are sure in for a wild ride, as Zuckerberg’s vision for Facebook rapidly comes to past.

Written by: Rachael N. Collymore
Managing Director. Publicist
Power Media Hub
Twitter: @rache_col | @powermediaHub
Instragram: @creativehub | @powermediaHub

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