UMG and Facebook strike ‘unprecedented’ global deal

Universal Music Group and Facebook have finally completed a multi-year agreement that will see the market-leading music company license its catalog across the social media giant’s various platforms.

Both parties heralded the global deal as “unprecedented,” where UMG’s recorded music and publishing catalogues for video are approved for use across Facebook, Instagram and Oculus.

The pact, announced early Friday morning, marks the beginning of Facebook’s long-anticipated – but until now, secret – ambitions in the music space. And it signals the beginning of the end of a sometimes frosty relationship between the music business and the tech giant, which has been accused of building its empire off the back of others’ copyright without passing on the stuff that folds. UMG is the first music company to strike a deal with Facebook, the social media behemoth platform which in March hit 2 billion monthly active users, making it the world’s biggest social app in terms of logged-on users. The U.S. based firm vaulted from 1 to 2 billion users in less than five years.

Over the past year, the Silicon Valley tech titan has been assembling a team of music industry professionals, led by Tamara Hrivnak, a lawyer who worked as director of music partnerships for Google Play and YouTube and earlier served as VP of digital strategy & business affairs for Warner/Chappell Music Publishing, Hrivnak came on board in January and has overseen negotiations with music rights holders.

Hrivnak, now Head of Music Business Development and Partnerships at Facebook, is quoted in the joint statement, pointing out the “magnetic relationship between music and community building.”

Through this new arrangement, users can upload and share homemade videos that feature music from the UMG library backdrop and, assuming the content itself doesn’t upset viewers, the clips won’t be yanked for breaching copyright. Financial terms weren’t disclosed, though its likely UMG was the beneficiary of a whopping advance.  

“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 while enhancing the social experience of music for their fans,” comments Michael Nash, Executive Vice President of Digital Strategy, Universal Music Group.

The partnership, he adds, is “an important first step demonstrating that innovation and fair compensation for music creators are mutually reinforcing – they thrive together. We look forward to Facebook becoming a significant contributor to a healthy ecosystem for music that will benefit artists, fans and all those who invest in bringing great music to the world.”

In time, both parties say, the functionality will expand to “enable access to a vast library of music across a series of social features” and, eventually, they’ll experiment on new music-based products for FB and its affiliates.

Video is a winner on Facebook. In November 2015, Facebook hit 8 billion average daily video views, double the figure reported just seven months earlier. And last year, FB founder Mark Zuckerberg told analysts that Facebook users watched an average of 100 million hours of video on the platform every day, though it has struggled to monetize that traffic.

The deal comes just two days after UMG struck a new, global, multi-year agreement with YouTube ahead of the streaming platform’s launch of new subscription platform.

This article originally appeared on The Industry Observer, which is now part of The Music Network.