Pop-rock group Walk the Moon may soon have reason to celebrate every time a flash mob posts a routine set to “Shut Up and Dance” on Facebook: The social media giant will finally start paying for music. On Dec. 21, 2017, the company announced a multiyear licensing deal with Universal Music Group, allowing users to upload and share videos on Facebook and its subsidiaries Instagram and Oculus that, for the first time, contain licensed music. Sources say Facebook has been nearing similar pacts with Warner Music Group and Sony Music Entertainment, deals that combined could bring the music industry over $1 billion in the next two years -- and give YouTube serious competition in the free-music space.
“This is use that right now we’re not getting paid anything for,” says one major-label executive. “If you put Bruno Mars’ ‘Marry You’ on your wedding video, someone should be getting paid.” The initial deals, sources say, will generally give labels and publishers lump-sum payments based on their market shares to cover the music that Facebook users upload. In their announcement, UMG and Facebook vowed to work “hand-in-hand” to “develop the next generation of music products that best engage social consumers.”