Snap Strikes Licensing Deal With World’s Top Record Label
(Bloomberg) -- Snap Inc. has struck a licensing deal with Vivendi SE’s Universal Music Group that gives its users access to thousands of songs, including tracks from Taylor Swift and Drake, in the latest tie-up between social-media giants and record labels.
Snap users will be able to use songs from Universal in messages and posts in the app, the two companies said Thursday. Music fans also can share links to full songs from their streaming service of choice. Financial terms of the partnership, which includes new features that tout Universal artists, weren’t disclosed.
Snap shares were up 1.6% to $67.44 in New York trading at 9:38 a.m. Vivendi gained 0.4% in Paris.
Record labels used to criticize social-media companies for exploiting their music to amass customers without compensating artists. But they’ve since recognized the promotional potential of the services -- and persuaded social-media companies to pay up.
“Fans are able to creatively build close-knit communities around the artists and the music they love, all while ensuring that artists are fairly compensated for the use of their music,” Michael Nash, Universal’s executive vice president of digital strategy, said in a statement.
Universal, the world’s largest music company, has already partnered with Snap to promote releases from some of its biggest acts. Snap’s users have created more than 10 million videos using Olivia Rodrigo’s “Drivers License,” works that have been watched more than 325 million times. Snap also developed custom lenses -- augmented-reality filters within the app -- for Billie Eilish, Nicki Minaj and Benee.
But this is the first time Snap users will be able to put Universal’s artists in their posts as part of Snap’s sounds feature. Snap rolled out that feature in October with licenses from Warner Music Group Corp., as well as the music-publishing arms of Universal and Sony Group Corp. While the publishing deals gave Snap access to song rights, it didn’t cover music performed by artists signed to Universal’s labels.
The app’s users have posted 521 million videos involving music since October, and those clips have been viewed 31 billion times. Almost half of them have been sent via direct message, underscoring Snap’s role as a messaging service.
“It’s been exciting to see how quickly Snapchatters have taken to our Sounds creative tool, and in turn the immense impact it has had on the music industry as they discover and share music with their friends and the community,” said Ben Schwerin, Snap’s senior vice president of content and partnerships.
While YouTube is the most popular site for music videos, and TikTok is where many new songs now go viral, Snap is eager to position its app as a key place for musicians and record labels to market their work. Snapchat reaches 90% of Americans between the ages 13 and 24.
Snap users have flocked to songs new and old. They have created more than 5 million videos with Notorious B.I.G.’s “Big Poppa,” a hip-hop classic, but also almost 5 million videos to songs from emerging act Julia Wolf.
Wolf credits Snapchat with helping her get the attention of Spotify Technology SA, which has featured her on playlists and put her on a billboard in New York’s Times Square.
Snap is rolling out new features that make it easier for its users to find the songs they want to put in their videos or recommend to friends, including the ability to search for songs and themed playlists. Music companies can also offer songs on Snap for 24 hours before the music is available on most streaming services.
“All of these features have been a huge part of introducing my music to a larger audience and fan base,” Wolf said.
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