In a shot at YouTube, Facebook signs a deal with Sony to let people post music clips

Key Points
  • Music publisher Sony/ATV will allow users to use its music on Facebook, Instagram and Oculus videos.
  • Songwriters will also be able to earn royalties from Facebook user song use.
REUTERS/Stephen Lam

Facebook users can now include Sony/ATV music in their video clips — and musicians will get paid royalties for their use.

The two companies said on Monday that they inked a licensing deal that would give users access to Sony/ATV's catalog of more than 3 million songs for use in any video posted to Facebook's platforms — including Instagram and Oculus. The deal means musicians would earn royalties from music posted there. Terms were not revealed.

The move is a challenge to Alphabet's YouTube, which has become one of the main vehicles through which listeners discover new music. (YouTube already has deals with Universal Music Group and Warner Music Group.)

Facebook CEO Mark Zuckerberg has called video a "mega trend," and the company has been actively trying to get more users and companies to use its platform for video with initiatives such as premium video feature Watch. Giving users the ability to use licensed music increases the appeal. (Facebook signed a deal with music publisher Universal Music Group in December.)

"We're excited to work with the largest music publisher in the world to bring amazing songs which deepen connections between friends and fans," Tamara Hrivnak, Facebook's head of music business development and partnerships, said in a statement.

Sony/ATV is one of the world's largest music publishers, with songs by Drake, Ed Sheeran, Taylor Swift, Kanye West, The Beatles, Bob Dylan and Queen in its repertoire.

More videos can also potentially boost revenue for Facebook, especially as its ad load increases. Facebook's Watch alone will bring in $565 million in revenue in 2018, according to Morgan Stanley analyst Brian Nowak. Facebook is also gearing up to test six-second ads before videos this year.