Facebook Using Music To Go For You Tube’s Throat?

In the mist of several music business stories chronicling the fight between the likes of Apple Music, Tidal, Spotify, and You Tube, who are all trying to create and be the streaming based model that saves/stabilizes the music industry, yet another social media conglomerate is throwing their hat in the ring. Sources have told The Verge that Facebook is in talks with major labels about “getting into music.” Further confirming what many tech and media business insiders have been already speculating on, Verge is reporting that Facebook executives have met with reps from Sony Music Entertainment, Universal Music Group and Warner Music Group to discuss their interest in the music business. The most immediate assumption is that Facebook wants to jump on the streaming service bandwagon and make yet another one of those.  However, this week’s launch of Apple Music show’s that FB might be recognizing trends, and angling for a different role in the market.

The Source has told The Verge that talks between all parties are still in the early stages, butt the only ones that need to worry about these new deals is You Tube.  Earlier this week, Re/code’s Kurt Wagner called it a “full-on attack” against YouTube because the social media service will be sharing ad revenue with selected companies whose videos are stored on Facebook. Sources say that this ad revenue sharing structure is likely to be using the attraction of music to build a new kind of video streaming system that will offer competition to You Tube.

If this turns out to be true, such a thing would be huge. When you consider the kind of major label based dominance that You Tube has been able to maintain in the music market through VEVO’s exclusive distribution partnership with You Tube and its parent company Google since 2009, Facebook’s breaking of that dominance with their own similar deals could, at its most, create a paradigm shift as big as the creation of You Tube itself, and at the least create market diversity that will give more options to the artist trying to make a business out of the music they create. Is anyone else excited to see what happens?