Facebook to pay music rights holders a proportion of advertising revenue on user generated content

As had been expected and anticipated, Meta has recently stated that it would be switching to a revenue-sharing model for user-generated video content, which will affect how artists and music rights holders get paid from Facebook

Meta’s new ‘revenue-share’ model will see Facebook pay music rights holders a proportion of ad revenue on user generated content. But how exactly will this work, and what does it mean for video and music advertising? We’ve put together this guide to outline all you need to know.

Music rights holders push for a revenue split

Most of the music we see in pop culture and the charts nowadays have usually accumulated a great amount of its popularity from video sharing apps like TikTok, with video creators sparking trends using music created by original artists.

The sharing of money among various social media platforms has been a point of contention for music rights holders for some time. Social media platforms like TikTok and Facebook appear to be becoming more and more popular – as are their creators – but artists and music rights holders don’t seem to be benefiting from them as much as the creators who are profiting off of their music.

Facebook listen to artists’ demand for monetisation

For some time now, many musicians have received upfront payments for their work, instead of getting paid each time one of their songs is streamed, or used on a platform, and thus making money every time someone hears their own music.

 Monetisation is a much fairer way for music rights holders and artists to profit from music advertising on social platforms like Facebook. After all, artists’ music can be streamed several times a day on video-sharing platforms and popular videos. Hence, it’s only right that their music is monetised, allowing them to receive money every time their material is played.

Meta have listened up and taken it on themselves to change the way music rights holders are paid on their Facebook and Instagram platforms. But what does this mean?

What is Meta’s revenue share model?

As we mentioned, a revenue-share model will replace all user-generated video material. Video creators who use licensed music in their videos will receive 20% under the new revenue share model Meta have in place – this applies to any video that is over 60 seconds.  Funds for this will come from the advertising income their created video content generates. The remaining funds will be divided equally between Meta and the song rights owners.

How much do music rights holders receive?

Video creators will receive 20% of the funds while the other 80% is split between the music rights holders and Meta. Therefore, a split of 80% of the money made from an artist’s music will go to the owners of the rights. The details of the split have not yet been disclosed by Meta, but artists can certainly anticipate a much higher profit from their own music with this new model.

Final thoughts

As you can see, such a change to how artists receive compensation for the use of their music is a positive step forward. It makes sense in context of the new ways that we enjoy music, and the consistent growth of social media.