Facebook is building an audio-streaming service
Earlier this month TMN reported that Facebook looked set to take on YouTube following licensing negotiation talks with the major labels for ad-supported full-length music videos. Now, the social media giant will follow this with an audio streaming service that will compete withSpotify and Apple Music.
MusicAlly has published an article based on an off-the-record discussion. It reports that Facebook will launch an on-demand audio service following the rollout of its music video feature. While a launch date or details surrounding the business model and royalty rates are yet to be decided, the sources told MusicAlly Facebook will perfect the video feature first.
The publication reports that trials of the monetised-video offering are expected to run in the next few months and as previously reported, is already building a third party-licensed system to pay music rightsholders for plays.
Facebook has 1.44 billion monthly active users and4 billion native videos are watched on the site each day; its problem is the amount of copyrighted videos that are immediately flagged and deleted due to Facebook not having the correct licensing in place.
To fix this, Facebook’s new system will see videos scanned against a database of files (similar to YouTube’s Content ID) to help rightsholders decide whether they want to take down user-uploaded clips featuring their music or allow it and receive ad revenue.
It’s believed rightsholders will get 55% of the ad revenue split and Facebook 45%.
MusicAlly said that in regards to the the audio streaming service, Facebook will match YouTube’s per-stream royalty rates to rightsholders upon launch. The publication’s sources also hinted that Facebook would likely be footing the bill for the build rather than acquiring another service. Facebook finalised its acquisition of WhatsApp in October for $19 billion, it purchased Instagram in 2012 for $1 billion and purchased Californiaproduction studio WaveGround Sound for an undisclosed sum last August.