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News / Ioná Corrêa / 01 Aug 2022

Facebook to share ad revenue from UGC videos with music rightsholders and creators

2 minute read

This week Meta announced that Facebook will be implementing some changes to the way in which they pay artists and music rights holders for the use of their works. The platform will now be moving to a revenue-sharing model for User Generated Content (UGC).

This announcement comes at a time when the debate around social platforms and the models they use to pay artists has been louder than ever, with leading executives calling them out for paying publishers and labels exclusively through lump-sum licensing agreements.

The new system announced by Meta, however, will allow video creators to get a 20% share of ad revenue. The remaining 80% will be split between the music rightsholders and Meta itself. The details regarding the nature of that split have not yet been confirmed.

There are a few conditions to this model, however: ad revenue will only be shared between creators and rightsholders when videos are at least 60 seconds long and contain licensed music. We have yet to see how happy the music industry will be with these terms, since long videos with licensed content on Facebook are definitely a minority – at least so far.

Other leading platforms, such as Instagram, are not affected by this, since the model is currently exclusive to Facebook. The new system also does not cover content that is not user generated, meaning that advertising on official music videos on Facebook is left unaffected for now.

Meta stated that the program is powered by a “a video, audio and image-matching tool” called Rights Manager. The program was developed by them to “help content owners protect their rights and manage their content at scale”.

Meta also added that while Music Revenue Sharing would start on the same day as it was announced, it would not yet be available worldwide yet: “To start, eligible videos will monetize from in-stream ads in the US, with expansion to the rest of the world where music is available on Facebook in the coming months.”

Even though we don’t have a lot of details as of yet, Meta’s move is quite significant and beneficial for rightsholders everywhere, being the first advance of its kind at this scale.

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