Facebook dangles financial carrot to record companies for music rights

Many videos posted on Facebook feature music to which Facebook does not have the rights.
Many videos posted on Facebook feature music to which Facebook does not have the rights.PHOTO: REUTERS

NEW YORK (WP) - Facebook is offering major record labels and music publishers hundreds of millions of dollars so the users of its social network can legally include songs in videos they upload, according to people familiar with the matter.

The posting and viewing of videos on Facebook has exploded in recent years, and many of the videos feature music to which Facebook does not have the rights.

Under current law, rights holders must ask Facebook to take down videos with infringing material.

Music owners have been negotiating with Facebook for months in search of a solution, and Facebook has promised to build a system to identify and tag music that infringes copyrights. Yet such a set-up will take as long as two years to complete, which is too long for both sides to wait, said the sources.

Facebook is eager to make a deal now so that it no longer frustrates users by taking down their videos; partners, by hosting infringing material; or advertisers, with the prospect of legal headaches.

The latest discussions will ensure Facebook members can upload videos with songs just as it is rolling out Watch, a new hub for video, and funding the production of original series.

Facebook is attempting to attract billions of dollars in additional advertising revenue and challenge YouTube as the largest site for advertising-supported videos online.

The money from Facebook is the latest windfall for a music industry surging from the growth of on-demand streaming services Spotify and Apple Music.