The Facebook parent company Meta has announced a new remuneration model for user-generated videos with licensed music and containing advertising.

As Meta explained in a blog post on Monday evening German time, corresponding Facebook users will in future receive 20 percent of the advertising revenue generated by the videos.

The rest goes to Meta and the rights holders.

How and to what parts the group and the partners from the music industry in turn distribute the funds was not disclosed.

Benjamin Fisher

Editor in Business.

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The model initially only applies to videos on Facebook and only to user-generated videos, i.e. not to official music videos that are also distributed on the platform.

In order to participate in the revenue, users must meet various conditions.

Videos must be at least 60 seconds long, contain "visual components" (the music cannot be the "main purpose" of the video), and users generally comply with the platform's monetization and other policies.

A tool called "Rights Manager" is intended to help rights holders identify audio, video and image material and exercise rights.

According to Meta, the model is now available to all users.

Initially, however, money will only be paid out for videos with advertising within the United States that fall under the conditions.

The function should be rolled out to the remaining markets in which Facebook has negotiated licensing agreements with the music industry in the “coming months”.

Step against Tiktok – and towards the music industry

The move is also likely to be a reaction to the growing competition from the video platform Tiktok, in which popular users are given a financial incentive to publish more videos on Facebook.

The area is becoming more and more important for Meta anyway.

According to the blog post, Facebook users spend half their time on the platform watching videos.

But the new model is also important for the relationship with the music industry.

On the basis of the license agreements negotiated to date, Facebook should not pay a small fee to the respective rights holder for every use of a piece of music on the platform.

This is basically how it works with streaming services like Spotify.

Rather, a one-time contribution for a certain period of time is said to have been paid for the basic permission to use music.

The industry website “Music Business Worldwide” recently reported on this approach – also with a view to the competitor Tiktok.

Meta called the new feature "a first of its kind and scope in the music industry."

The group also announced that it would like to make further agreements with rights holders in order to increase the selection of music that is licensed and therefore available for the function.

Meta in dispute with two music companies

A current dispute with cobalt shows how difficult the issue is.

The British music company, one of the major indie publishers, announced at the weekend that it would remove its catalog of around 700,000 songs for Facebook and Instagram in the USA.

The background to this is an expired license agreement, which both parties have not yet been able to agree on extending.

But it will continue to be negotiated.

Basically, disputes like this happen from time to time.

It is unclear whether the dispute is related to the described fundamental nature of the contracts with Meta.

Last week, the Swedish music company Epidemic Sound also filed a lawsuit against Meta for alleged misuse of its catalog on Facebook and Instagram.

The music industry's income via Facebook, Instagram or Tiktok is significantly lower than from streaming, the main sales driver for years.

But for some time now, music companies have been only too happy to point to the strong growth and opportunities in this area.