It may come as a surprise but until a couple years ago, Facebook never licensed music or paid royalties. To my knowledge, Facebook paid huge payments to major labels and publishers and also made some deals with a handful of indie labels. These payments probably totaled around $500 million, or that’s the rumor. Rather than coming clean, Facebook has kept these deals a secret.
Facebook recently announced a $100 million fund to be paid to up to 30,000 small businesses (in 30 countries, so put that in perspective) that would be paid out in a combination of cash and advertising credits which is about $3,333 each. Here’s the announcement:
We know that your business may be experiencing disruptions resulting from the global outbreak of COVID-19. We’ve heard that a little financial support can go a long way, so we are offering $100M in cash grants and ad credits to help during this challenging time.
Facebook is offering $100M in cash grants and ad credits for up to 30,000 eligible small businesses in over 30 countries where we operate. We’ll share more details as they become available.
Oh, yes, so “we’ve heard” and you know, we’ve heard that too!
Like so many things with Big Tech, the headline is made to sound like a big deal, but by the time you do the math it’s really not all that exciting. This is particularly true when you consider that in the time it’s taken you to read this far in this post, Facebook has probably already made $100 million.
The good news is that many independent artists already have a billing relationship with Facebook, which means that Facebook has the means to put cash directly into their bank accounts or credit cards (like a refund) or other account like PayPal or Venmo. For those with those accounts already set up with Facebook, the company can make those payments today. $5,000 sounds about right for starters.
And that’s exactly what Facebook should do. There can be a secondary round of payments on a signup basis to give Facebook the means to make payments directly to those for whom it lacks billing information.
Facebook could also give a significant chunk to the PROs for payment out to their indie songwriters with the PRO acting as paymaster (and for which admin fees should be on a transaction cost basis).
These tech companies would have you believe that they intend to save the world. However laughable that proposition may be, there is a world they could at least try to save instead of ripping off. And since they are so interested in saving the world, any relief funds they pay should come with no strings attached, not a requirement to sign up to any deal, click through agreement or other shenanigans we have come to expect from them and their lackeys.
So far, it’s crickets from Facebook and their oh so posh music licensing staff. They’re not even doing the easy thing like writing a check to Musiccares. What they are doing is writing big checks to lobbyists to preserve their undeserved safe harbors and copyright reform efforts like the European Copyright Directive.
If that sounds entitled, that’s probably because it is. I think that independent artists and songwriters are entitled to redress and at a minimum relief from the Goliath that has been ripping them off consistently for years.