Facebook Inc and Universal Music Group signed a global agreement that will give users access to Universal’s music catalogs to be used in videos uploaded across the social media network as well as Instagram and Oculus.
The multi-year agreement will be expanded later to include Facebook Messenger, Universal Music Group, according to Reuters.
”“Together, Facebook and UMG are creating a dynamic new model for collaboration between music companies and social platforms to advance the interests of recording artists and songwriters,” said Michael Nash, executive vice president of digital strategy, Universal Music Group.
The partnership comes days after Bloomberg reported that Alphabet Inc’s YouTube had signed a new long-term agreement with Universal Music Group and Sony Music Entertainment.
In an internal memo on Thursday, UMG’s chairman/CEO Lucian Grainge told staff: “As with our deal with Spotify earlier this year and our license renewal with YouTube, our deal with Facebook leverages the experience we’ve gained and the wealth of data we’ve amassed to win both greater flexibility as to how our music is offered to the public as well as fairer compensation for our artists — as we continually refine the balance between direct promotion and monetization.”
The companies explained that the partnership will give Facebook and Instagram users the ability to upload and share videos that contain licensed music. “In time,” a press release on the partnership noted, “functionality will expand to enable access to a vast library of music across a series of social features.”
The other major record companies are nearing similar deals, sources tell CASHBOX, A joint statement from the company said the deals will “serve as a foundation for a strategic partnership roadmap that will deliver new music-based experiences online.” All told, such licensing deals with the social media giant could generate roughly $1 billion for the music industry over the next two years, sources said.